Involving Local Authorities
In the programming process of EU Cooperation In Malawi
LOCAL AUTHORITIES ROADMAP
FOR THE 2021-2027 CYCLE OF EU COOPERATION
November 2020
Headquarters Address of the NALA
Contacts : Telephone, Fax, Emails, Portal, Web Site…
TABLE OF CONTENTS
TABLE OF CONTENTS 2
EXECUTIVE SUMMARY 4
INTRODUCTION 6
PART 1 8
ASSESSING LOCAL AUTHORITIES INVOLVEMENT IN DEVELOPMENT AND COOPERATION POLICY 8
1.1. MAIN CONCLUSIONS RESULTING FROM THE COMPENDIUM 8
1.2.MAIN FINDINGS FROM THE ANALYTICAL REPORT 10
1.3.MAIN IDEAS DERIVING FROM THE FIRST CONSULTATIONS OF NATIONAL GOVERNMENT AND EU DELEGATION ON
THE ANALYTICAL REPORT 14
1.4CONCLUSION 14
PART 2 16
ENHANCING LOCAL AUTHORITIES PARTICIPATION IN DEVELOPMENT AND COOPERATION POLICY:
ACTIONS EXPECTED FROM DECISION-MAKERS AT NATIONAL GOVERNMENT LEVEL AND AT EU
DELEGATION LEVEL 16
2.1 RECOGNIZING THE LOCAL AUTHORITIES AND THE NATIONAL ASSOCIATION OF LOCAL AUTHORITIES AS
PUBLIC/STATE ACTOR:WHICH FORMALIZATION? 16
2.2 IMPLEMENTING THE LOCAL AUTHORITIES AND THE NATIONAL ASSOCIATION OF LOCAL AUTHORITIES
INVOLVEMENT MECHANISMS: INFORMATION, CONSULTATION, DIALOGUE, PARTNERSHIP MEASURES 18
2.3 FUNDING 22
2.4 CONCLUSION 25
PART 3 27
ENHANCING LOCAL AUTHORITIES MEANINGFUL INVOLVEMENT IN DEVELOPMENT AND
COOPERATION POLICY: ACTIONS EXPECTED FROM THE LOCAL AUTHORITIES AND THE NATIONAL
ASSOCIATION 27
3.1. Organizing a meaningful and competent voice of Local Authorities: The critical political and institutional role of the Malawi Local Government Association (MALGA) 27
3.2. Capacity Building 30
3.3. Setting the Objectives of the Local Authorities and the National Association of Local Authorities 34
3.4. Defining the National Association of Local Authorities Plan of Action 38 2.5 3.4MALAWIROADMAP:PRELIMINARYTABLEOFNEEDSFORPROGRAMMINGPERIOD2021-
2027 39
CONCLUSION 47
LIST OF ABBREVIATIONS AND ACRONYMS
ADP Area Development Plans
ALGAM Association of Local Government Authorities in Malawi
AU Africa Union
DDP District Development Plans (DDPs DHO District Health Office
EC European Commission
ECD Early Childhood Development
EU European Union
HRH Human Resource for Health
HSSP II Health Sector Strategic Plan II
ICT Information Communication and Technology LA Local Authority
LG Local Governments
LGAP Local Government Accountability Project M&E Monitoring & Evaluation
MALGA Malawi Local Government Association MGDS Malawi Growth and Development Strategy MNPSRP Malawi National Public Sector Reforms Policy
MoLGRD Ministry of Local Government and Rural Development MPSMP Malawi Public Service Management Policy
NACS II National Anti-Corruption Strategy II NAIP National Agriculture Investment Plan NAP National Agriculture Policy
NDICI Neighbourhood Development and International Cooperation Instrument NDP National Decentralisation Programme
NEP National Education Policy
NESIP National Education Sector Investment Plan NESP National Education Sector Paper
NIP National Indicative Program NIP National Indicative Program (NIP) PFM Public Finance Management
SDGS Sustainable Development Goals
TEVET Technical Education & Vocational Educational Training UCLGA United Cities for Local Government in Africa
UHC Universal Health Coverage UN United Nations
USAID United States Agency for International Development VDC Village Development Committee
VDP Village Development Plans VNR Voluntary National Review
EXECUTIVE SUMMARY
Local government authorities (LGAs), being the level of governance closest to the citizens, represent the expressions of communities and facilitate the implementation of their development needs. Decentralisation is the generally adopted model under which governmental functions are conferred on local authorities through the national constitution or parliamentary legislation. They provide the platform at which communities can articulate the challenges confronting them and formulate solutions to address them in ways that resonate with their local context and culture. The provision of public services by local government facilitates responsiveness to needs of the citizens in a way that recognises the unique characteristics of the locality minimising the risk of ‘one size fits all’ that nationally determined public policies pose. In Malawi, decentralisation has been recognised and adopted through the national Constitution and further operationalised by the Local Government Act and decentralisation policy the last two having both been adopted in 1998. However, the implementation of the decentralisation law has been very slow and for some sectors even stagnated. The full recognition of LGAs as developmental state actors has not been realised in Malawi. This roadmap proposes further strengthening the decentralisation policy by recognizing the human dimensions of development rather than restricting development initiatives to a fixed spatial definition as well as allowing all stakeholders – private sector, civil society, non-governmental organisations, development partners and individuals to participate and contribute to the development of their territories. The adoption of the Territorial Approach to Local Development (TALD) is, thus, an important element of the recommendations of this roadmap. It is also proposed to recognise the main representative of LGAs, the Malawi Local Government Association (MALGA) as a state actor and to facilitate its access to development funds from the fiscus. The road to full decentralisation will necessarily demand capacity building for LGAs and the MALGA.
Part 1 reviews the existing environment for decentralisation in Malawi with particular focus on the legislative framework and its translation into reality. While the Constitution and Local Government Act provide for decentralisation with the expectation of localisation of sector ministries responsibilities, very few government departments have effectively handed over to LGAs. Historically, the country has experienced dictatorial regime at independence characterised by high levels of centralisation. Following democratisation, more serious attempts were made to legislate for decentralisation but its implementation continued to be overshadowed by concerns about capacity.
Part 2 considers the options to enhance LGAs participation in development and development cooperation. The imperative of the localisation of sector ministries responsibilities as envisaged by the Constitution and Local Government Act and further elaborated in the decentralisation policy of 1998 is presented. This should be further strengthened by the adoption of the TALD in order to strengthen and enhance the outcomes of decentralisation. Similarly, the importance of the localisation of global agendas – African Union Agenda 2063; Sustainable Development Goals (SDGs); Climate Agenda; and others is also recommended. Options for development funding for LGAs are considered. The recognition of MALGA as a state actor and legitimate beneficiary of state funding is presented as well as the need for its strengthening through capacity building.
The participation of LGAs represented by the MALGA in the EU development cooperation programming process under the Neighbourhood Development and International
Cooperation Instrument (NDICI) for the 2021 to 2027 period is discussed and recommendations made on the collaboration between MALGA and central government leading to engagement with the EU Delegation.
Finally, Part 3 proposes specific interventions to guide the process of strengthening LGAs for the effective implementation of the decentralisation policy and the involvement of LGAs in national development and cooperation policy. The central role of capacity building for both LGAs and the national association is recognised and emphasized. In order to complete the process the inclusion of MALGA in the development cooperation process and as beneficiary in the EU programming is recommended. It is proposed to enter into a Framework Partnership Agreement between the MALGA and EU Delegation for the strengthening of decentralisation over the programming period.
INTRODUCTION
Why improve LAs involvement in development and cooperation policy? Rationale of the Roadmap.
This roadmap explores the path to transform governance in Malawi from a highly centralized system with most political power and authority to define and chart development vested in the national government to a country in which local government authorities (LGAs) have developmental power and can harness the resources of their local territories towards a robust decentralized economy addressing the needs of their communities to reach relevant and sustainable developmental outcomes. The roadmap is also informed by a study conducted by the United Cities and Local Governments, Africa (UCLG Africa) on a compendium and analytical report on decentralization in Malawi1 Malawi is a landlocked, densely populated country located in the southern part of Africa.
It is one of the poorest countries in the world “with a per capita gross national income (GNI) of just US$320 in 2016, one of the lowest in the world” (International Monetary Fund, 2017:1). Malawi gained its independence in 1964 and yet it is one of the least developed countries which largely depends on agriculture for its social and economic development. The first 30 years Malawi was under autocratic one-party rule of Kamuzu Banda which was marked as a frail economy. In 1994, Malawi transitioned to a democratic state and Malawi’s new constitution of 1994 introduced multi-party democracy. These changes saw the collapse of the autocratic one-party state machinery and adoption of a liberal democratic constitution in 1995 which, among other things, guarantees a full range of civil, cultural, political, social and economic rights, democracy, good governance and rule of law.
While these changes were positive the centralization of power and authority for development has persisted despite the enactment of a Local Government Act and the launching of a decentralization policy in 1998. The successive regimes have all espoused decentralization as the model of governance they would champion, however, the implementation has remained weak and half-hearted.
This roadmap is an attempt to break the cycle of stagnation in the implementation of decentralization policy in Malawi through strengthening the participation of LGAs led by MALGA, the national association, in national development and cooperation programmes.
The roadmap seeks to include MALGA as the representative organization of LGAs in the EU programming process under the new financing instrument, the Neighbourhood Development and International Cooperation Instrument (NDICI) that will guide its next programming of the period 2021 to 2027. Following the issuing of the EC 2013 Communication on “Empowering local authorities in partner countries for enhanced governance and more effective development outcomes”, local and subnational governments have now been recognized as state actor in their own rights and capacity, working as proximity public authorities besides the central government according to the principle of subsidiarity. In light of this development, The United Cities for Local Government in Africa (UCLGA) has sought to assist local authorities through their national
1 Chiweza, Asiyati Lorraine (2020), The Analytical Report (Unpublished research conducted on behalf of the United Cities and Local Governments, Africa
associations to get prepared to proactively and efficiently participate in the dialogue with the national government and the EU delegation leading to the definition of priorities and programs to be included in the country’s EU cooperation.
The roadmap, thus, proposes the actions that are designed to engage LGAs led by MALGA in the EU programming process culminating in agreement on a programme of support aimed at strengthening decentralization to improve the developmental outcomes for the citizens.
PART 1
ASSESSING LOCAL AUTHORITIES INVOLVEMENT IN DEVELOPMENT AND COOPERATION POLICY
This part describes the reasons why the inclusion of LAs in the processes of developing and implementing development and cooperation policy should be promoted. In this part, it is important to note that not only is LAs involvement in development and cooperation is desirable, it is also necessary and even crucial. One of the key benefits of a strong involvement of LAs is that it can bring first-hand data and locally-grounded knowledge that can allow decision-makers at national level to define development and cooperation policies that take better account of local contexts. It also enhances the participation of local civil society through the organization of participatory multi-stakeholder consultations in the definition of local policies and explore multiple and innovative ways giving policy makers different options for action.
1.1. Main conclusions resulting from the Compendium
The country’s supreme law, the Constitution of the Republic of Malawi, in Section 146- 148, provides for the establishment, composition, functions and powers of rural and urban local government authorities. The constitution makes local government authorities (LGAs) responsible for the representation of the people over whom they have jurisdiction, for their welfare. The Constitution2 stipulates the following responsibilities for local authorities:
1. The promotion of infrastructural and economic development, through the formulation and execution of local development plans and the encouragement of business enterprise;
2. The presentation to central government authorities of local development plans and the promotion of the awareness of local issues to national government;
3. The consolidation and promotion of local democratic institutions and democratic participation; and
4. Other functions including the registration of birth and deaths and participation in the delivery of essential and local services, as may be prescribed by any Act of Parliament.
(Italics, Emphasis)
The Constitution also establishes the National Local Government Finance Committee under Section 149 (1). The committee’s powers and responsibilities as provided in section 149(2) include:
- To receive annual estimates of revenue and expenditure budget from local authorities;
- To supervise and audit (check) accounts of Councils;
- To make recommendations on the distribution of funds allocated to Councils by central government.
The constitutional provisions only provided the legal foundations and imperatives for the creation, reform, and support of local government but did not stipulate the exact form the local government structures were to take, this, culminating in the 1998 National
2 Malawi Government, Constitution of the Republic of Malawi
Decentralisation Policy that provided the basis for the 1998 Local Government Act. The policy devolves administration and political authority to the district level; integrates governmental agencies at the district and local levels into one administrative unit, through the process of institutional integration, manpower absorption, composite budgeting and provision of funds for the decentralised services; diverts the centre of implementation responsibilities and transfers these to the districts; assigns, functions and responsibilities to the various levels of government; and promotes popular participation in the governance and development of districts. The decentralisation policy seeks to achieve the following objectives:
- To create a democratic environment and institutions in Malawi for governance and development at the level that will facilitate the participation of grassroots in decision- making;
- To eliminate dual administration (Emphasis) at the district level with the aim of making public services more efficient, more economic and cost effective.
- To promote accountability and good governance at the local level in order to help government reduce poverty; and
- To mobilise the masses for socioeconomic development at the local level
The policy designates local authorities as planning authorities charged with the overall development of the district.
The long-term development strategy defining the aspiration of Malawians is articulated in the Vision 20203 :
• “by the year 2020 Malawi as a God-fearing nation will be secure, democratically mature, environmentally sustainable, self-reliant with equal opportunities for and active participation by all, having social services, vibrant cultural and religious values and being a technologically-driven middle-income country (Malawi Government 2017:30).”
This national vision has been pursued through the implementation of 5-year medium term development strategies. Since 2000, the country has used the Malawi Poverty Reduction Strategy Paper (2001-2004), and then moved on to the Malawi Growth and Development Strategy (MGDS) with the latest being the MGDS III development framework which covers the period from 2017 to 2022.
Perhaps the most revealing study that points to the real challenges affecting decentralization and governance in Malawi is the 2016 Malawi Growth and Development Review4. The report reviews and assesses the effectiveness of the MGDS II in achieving stated objectives, the relevance and effectiveness of strategies and interventions. The review found an apparent disconnect between the MGDS II and the national vision. The review also noted that although more than 15 years after the National Decentralization Policy (1998) and the Local Government Act (1998) were passed, actual progress was slow with minimal sector ministries response to the intentions of the policy and the law.
Although decentralisation is based on the principle of ‘power to the people,’ the relevance
3 Government of Malawi, Review of 2020 Vision, Final Report, November 2019, Lilongwe
4 Malawi Government (2016). Malawi Growth and Development Strategy (MGDS II) Review and Country Situation Analysis Report. Ministry of Finance, Economic Planning and Development: Lilongwe
of most District Development Plans and budgets is undermined by minimal consultations of grassroots communities, particularly socially marginalised and/or vulnerable groups.
The report highlights the lack of will of the bureaucracy to fully decentralize, the tendency being to retain control at the centre. The successor MGDS has re-emphasized the primacy of decentralization as the mode of national development:
MGDS III implementation will emphasize devolution of those functions that have not yet been devolved so that decisions are made at the local level for development efficiency and effectiveness. It is expected that local government councils will take active role in putting up policy decisions that will facilitate development programmes that are inclusive and help the country attain sustainable national development (GOM, 2018) 1.2. Main findings from the analytical report
The Analytical Report focused on the following:
• A Political Economy Analysis that assesses the feasibility of the new political agenda based on Local Authorities at country level
• Providing strategic answers to the following questions:
– Evolution observed at the level of the central government with regard to the
"territorialization" of the main national plans and national sectoral policies. It assesses how strong the national commitment is to integrate the spatial dimension in development management? Is the option of territorialization translated into specific plans and policies and clear implementation processes?
Existence or not of sustainable national financing mechanisms?
– The extent to which the Central Government consider Local Authorities as a
“development actor” in its own right and an essential partner to be associated in the implementation of public policies at the territorial level (SDGs, Nationally Determined Contributions (NDCs)? Or are they just implementing agencies.
– The extent to which central government recognize the added value of Territorial Approaches to Local Development, spearheaded by the local authorities on the basis of their general mandate (if this general mandate exists in the country)? Recall the opportunities and constraints encountered in the implementation of Decentralization reforms: effectiveness of the transfer of competences and resources.
• A SWOT Quick Analysis of the National Association of Local Authorities: strengths, weaknesses, opportunities, threats with strong and objective arguments and areas for improvement. This analysis should be undertaken and discussed with the Executive Board of the National Association, particularly with regard to territorial approach to local development (TALD) and the role of Local Authorities as development actors.
• A state of the art concerning the territorialization of national policies and global programs, including SDGs, both at the level of policies and programs implemented within the framework of the National Development Plan.
• Lines and priorities of actions to consider for local authorities to promote the territorialization of public policies and global agendas as well as local development programs, and to respond to the problems revealed by the SWOT analysis.
The implementation of decentralisation in Malawi as perceived by the country’s Constitution remains elusive. Over the 20 years since the enactment of the Local Government Act and the Decentralization Policy, a lot of studies, reviews and evaluations supported by both government and a variety of non-state actors have been undertaken.
They all point to one key finding: the decentralization progress has been mixed and the rate of devolution has been piecemeal with some areas moving forward while others lagging behind. A number of underlying factors have been identified. Firstly, there has been a weak link between decentralisation policy reforms and the broader public service reforms agenda of the various government; Second, there have been shifting political interests about decentralisation over the 20-year period. Depending on the interests of the ruling elite, this has for some periods contributed to limited political and bureaucratic championship and oversight over the implementation process but also selective implementation of decentralisation reforms that appear not to threaten the regime’s interests.
The office of the President and Cabinet was supposed to be the administrative champion but its role has not been strong during some years especially during periods where the ruling regime was not keen on devolution. Similarly, the oversight role of Parliament over the implementation of the decentralisation policy has not been evident.
If anything since 2010, Parliament itself has been in the forefront of diluting the local government legislation. In 2010 deliberate amendments were made to the Local Government Act which introduced measures to favour powers of decision making centred on Members of Parliament and low allocation of development resources to local authorities. Attempts have been made to reverse these amendments but they have faced huge resistance from interested actors, mainly MPs. These amendments still hold to-date and they have stifled the ability of the LGAs to fully meet their mandatory requirements as agents of development.
There have been evident cases of lack of confidence in local authorities by both Cabinet and Members of Parliament who have raised concerns in their parliamentary deliberations. This is coupled with some controlling officers in the central ministries who have openly reluctant to giving full mandate to local authorities to manage development programmes and other aspects of the decentralisation process. This lacuna and politicisation have contributed to de-professionalisation in the employment of the local authority key staff with perpetual transfers of District Commissioners (DCs). This has made it difficult for the DCs to deliver local government mandates and have created an instability that make them unable to strategically guide the implementation of District Development Plans.
In addition, even among the 18 sectors claimed to be devolved, not all earmarked functions within each sector have actually been devolved. This means that while the
Decentralisation Policy identifies many functions to be transferred to local authorities, there are very few MGDSIII key priority ones that Malawian local authorities have mandate over.
Sector devolution plans guiding the devolution process were done 20 years ago and there is need to review them to ensure that the priority sectors devolve the necessary functions.
What is MALGA doing to push the central government to fully devolve and deal with the observed resistance to devolve functions to the district level?
Although the central Government has devolved some functions to Local Authorities, the requisite financial resources to enable Councils perform such functions have not been fully devolved to Councils. The LAs in Malawi in particular the rural councils (district councils) significantly rely on the transfers from the Central Government (80 percent for rural councils and 20 percent for urban councils)
“He who pays the piper calls the tune”
Although the legal framework mandates central government to provide adequate resources to local authorities, in practice few resources go to local government for development. The heavy reliance of local government on Central Government for financing compromises their autonomy as
‘development actors’ in their own right.
In terms of development funding some movement was made when government in 2015/16 started devolving the District Development Budget (DDB). The establishment of DDB which is a fund for local development managed by local authorities is an important signal of that central government’s recognition and commitment to the
added value of territorial approaches to local development. However, this remains a small portion as most funding such as other funding modalities such as Constituency Development Fund are not under the full control of the local authorities. Current central government fiscal decentralisation approaches embody different rules and pull in different directions. As a result, mega development projects are done by Central Government, with local authorities carrying out small, micro projects that also compete on resource envelope available.
The Central government is also yet to devolve assets to the local government Thus, in practice local authorities are in most cases serving as implementation agencies of the
Policy and Practice
For example, in the 2019/2020 fiscal year, Government allocated about K8.5 billion to councils for development out of national (domestic) revenue of around K1.4 trillion, representing around 0.6%. If Government was to comply with the decentralisation policy (5%), it would have transferred about K71 billion. With this funding gap, one would argue that local governments are just implementing agencies of the central government because they cannot make their own decisions regarding development.
Central or Local?
Over the years, the executive as well as parliamentarians from both ruling and opposition parties have taken a selected set of decisions that have shaped a compromised pattern of intergovernmental fiscal transfers strategically conceived to shore up their political interests and visibility in delivering local public goods and services. For example, funding from World Bank in the name of Local Development Fund does not reflect the needs of the local authorities. Similarly funding channelled through the Constituency Development Fund, Community Development Fund, and Constituency Borehole Funding is not in tandem with the DDP but was carefully crafted to shore up the interests of national political leaders, particularly Members of Parliament.
central government and not as development actors in their own right. They mostly behave as an appendage of central government because of lack of funding. Transfers made by the Central Government are not matching with the expenditure responsibilities of the local authorities. A recent study has observed that a major factor contributing to this state of affairs is that there is no fiscal decentralization policy in Malawi despite the Decentralization Policy being in force since 1998. The objective of the fiscal decentralization policy would be to provide sufficient resources, and also build the capacity of local governments to mobilize resources in order to implement their decentralized functions. This Policy is supposed to provide guidelines on the implementation of fiscal decentralization in Malawi.
Malawi Association of Local Government Authorities (MALGA)
There is a strong perception that MALGA is overly influenced by the Ministry of Local Government that seems to control its operations. MALGA is expected to operate as a strong pressure group on local government matters that analyses issues and challenges (even seek legal redress) the central political leaders and various central government ministries, departments and agencies over central government failures like the incomplete process of sector and fiscal devolution. Stakeholders expect a MALGA that should stand up to challenge the persistent local governance policy reform bottlenecks and get decentralisation back on its intended path to make sure that local authorities are able to deliver on their mandates. Local authorities programming should be such that it should change the landscape to focus more on local development and livelihoods of communities.
There is need to strengthen the image of MALGA among its members, effectively mobilise their participation, and ensure that they are part of the execution of its mandates. A low level of participation of women in local governance was also noted to be another weakness where participation is concerned. There is low number of female councillors in Malawi as well as in management positions in all councils.
Members’ subscription resources are able to finance only 30% of MALGA’s operational costs with about 70% met by projects supported by various donor and other non-state actors’ projects. In addition, the rentals of offices that house MALGA are paid for by the central government.
As a voice of local authorities, they were supposed to have comparative advantage in such areas as local development planning, lobbying advocacy and research etc
Greatest opportunity is the regime change and the rising to power of a new government since June 2020 that is keen on advancing public sector reforms and strengthening key governance institutions. Regime change is an opportunity for MALGA as a policy window has opened.
The greatest challenge is lack of independence. The MLGRD treats MALGA as a department of the Ministry. This is the greatest threat to the operations of MALGA as it becomes difficult for MALGA to turn around and challenge the MLGRD on the issues it needs to reform.
Party politics and politicisation of local government reform is another threat that can compromise the objectivity and independence of MALGA’s members.
MGDS III has made the territorial approach to local development very explicit and it has made it clear that the national plan will be implemented through the decentralised local authorities.
The District Development Planning System (DDPS) that government adopted in 2001 emphasises a bottom up and people centred approach to local development and demonstrates the recognition by the central government of the territorial approaches to local development
Key Priority Issues:
• The MALGA executive should devise specific strategies on how to engage with its members on a continuous basis to sensitise them of this EU programming initiative so that MALGA can work and move together with its members on these processes.
• The MALGA should synthesise information on the status of decentralisation and together with its members develop a lobbying and advocacy strategy to engage the following actors on accelerating sectoral and fiscal devolution: the new political regime leadership; Office of the President and Cabinet; Parliamentary members including the Committee on Decentralisation; Ministry of Finance; and National Local Government Finance Committee and the Planning Commission on local development Fiscal Decentralisation.
• MALGA should improve the staff complement by ensuring the filling of posts for the programme officers that are vacant. The target should be to ensure that the recruited staff have local development planning and lobbying and advocacy skills.
• MALGA should consider decentralising its services to the regions so that local authorities can easily be supported in. Regional offices which report to the umbrella body are needed to improve service delivery to its members.
1.3. Main ideas deriving from the first consultations of National government and EU delegation on the analytical report
There has been no engagement between the MALGA and the EU Delegation in the context of the 2021 to 2027 programming process.
1.4 Conclusion
Conditions to fulfil for an enhanced involvement of LAs in development and cooperation policy in Malawi: opportunities to build on and threats to address.
The effective implementation of decentralization as envisaged by the national constitution, the decentralization policy and the Local Government Act has been elusive over the last twenty years. The 2016 Malawi Growth and Development Review study exposed the reluctance of the bureaucracy to honour the intentions of the law in full.
Members of the Cabinet and senior sector ministries’ officials have been reluctant to implement measures to transfer responsibilities and resources to the local government
authorities. The introduction of the constituency fund administered by members of Parliament on both sides of the political divide has also enlisted negativity to decentralization among legislators who now benefit from the political leverage that the funds have endowed them. Both the bureaucracy and the legislators cite lack of capacity of local government authorities as well as mistrust for their reservations on decentralization.
The new government elected as of June 2020 has espoused decentralization and community participation in the governance architecture of the country. This new political dispensation offers opportunities for change. There is real opportunity for mobilization of all relevant stakeholders to implement the provisions of the decentralization policy and the commensurate legislation. The new environment also presents the opportunity of introducing the concept of Territorial Approach to Local Development (TALD). The opportunities presented by TALD such as the possibility of a holistic approach to development; strengthening of local economic development LED); addressing the challenges of climate change, and the localization of global agendas can also be realized.
The lack of capacity of local governments and the installation of appropriate systems for ensuring transparency and accountability can also be addressed.
The new EU programming, the Neighbourhood Development and International Cooperation Instrument (NDICI) presents funding opportunities with its geographic focus that can be extrapolated from the national country focus to also the local community focus.
Notwithstanding the opportunities cited above, the risk of ricocheting to the old stagnation whereby both political and executive leadership shun decentralization cannot be ignored. Hence, the need for urgency to implement the reforms already enacted by law and introduce new measures to strengthen democracy. Also, the need to urgently address the capacity development needs of local government authorities, including training and education, should be closely linked to all the envisaged changes to ensure that these authorities are ready to effectively respond to decentralization environment.
Decentralisation should also be supported by effective systems development and deployment in order to ensure that local government authorities can effectively carry out devolved functions. An accusation often levelled against lower-tier structures of governance is the risk of corruption and lack of integrity. It is, thus, essential to promote the adoption of open transparent systems that provide the citizens with adequate information, including digitization.
PART 2
ENHANCING LOCAL AUTHORITIES PARTICIPATION IN DEVELOPMENT AND COOPERATION POLICY: ACTIONS EXPECTED FROM DECISION- MAKERS AT NATIONAL GOVERNMENT LEVEL AND AT EU DELEGATION
LEVEL
Actions by decision-makers at national and EU delegation levels to enhance LAs participation in development and cooperation policy
The focus of Part 2 will be on the question of how LAs can be involved to reach the development and cooperation policy goals. This is informed by the mandates of LAs as defined by the decentralization laws in the country, and the enabling environment created by law for LAs interventions and actions. An appraisal to identify gaps between what is prescribed and what is implemented, as well as areas of improvements for enhanced LAs participation will be explored. The importance for the mandatory inclusion of LAs through their representative national association in dialogue platforms with national government representatives, inter-ministerial bodies, multidisciplinary working groups, and other development partners, including EU delegation will be highlighted.
2.1 Recognizing the Local Authorities and the National Association of Local Authorities as Public/State Actor: Which formalization?
Local Government Authorities as State and Developmental Actors
Chapter XIV of the Constitution of the Republic of Malawi provides for the establishment of Local Government Authorities (LGAs). Article 146 specifies that LGAs shall be responsible for the representation of the people over whom they have jurisdiction, for their welfare. It further defines their responsibilities5 –
1. the promotion of infrastructural and economic development, through the formulation and execution of local development plans and the encouragement of business enterprise;
2. the presentation to central government authorities of local development plans and the promotion of the awareness of local issues to national government;
3. the consolidation and promotion of local democratic institutions and democratic participation; and
4. such other functions, including the registration of birth and deaths and participation in the delivery of essential and local services, as may be prescribed by any Act of Parliament.
Following, the Cabinet adopted a decentralisation policy in October 1998 which espoused the following objectives:
5 Government of Malawi (1995). The Constitution of the Republic of Malawi, Zomba:
Government Press
a. to create a democratic environment and institutions in Malawi for governance and development; at the local level which will facilitate the participation of the grassroots in decision making;
b. to eliminate dual administrations (field administration and local government) at the district level with the aim of making public service more efficient, more economical and cost effective;
c. to promote accountability and good governance at the local level in order to help Government reduce poverty; and
d. to mobilise the masses for socio-economic development at the local level.
The intentions of both the Constitution and the decentralisation policy aim to create local government authorities (LGAs) that are a political representation; mobilizers of their communities towards addressing local needs; and implementers of development. The policy further makes clear the intention to eliminate dual administrations (field administration and local government) at the district level with the aim of making public service more efficient, more economical and cost effective. The practice, however, has deviated significantly from these noble political goals further supported by administrative policy as LGAs have been relegated to merely being agents of central government undertaking parcelled out tasks determined by central bureaucrats.
The National Association, MALGA, as State Actor
The Association (MALGA) is registered under the Trustees Incorporation Act. MALGA is not recognised as State Actor by the Government. It is considered as a civil society organisation (CSO). The Association does not receive any state grants.
MALGA is not officially recognized by Parliament, however, it engages it to lobby for and on behalf Local Governments. For instance, during budget sitting of Parliament, MALGA is invited to comment on the funds allocated made to local governments. MALGA participates in number of activities in partnership or collaboration with the Ministry of Local Government. For example, MALGA collaborates with the Ministry on the training of councillors; on review of local documents such as Local Government Act, Decentralisation Policy, and training manuals for councillors.
Sector ministries are also not obliged, by law, to consult MALGA on any issue affecting local authorities.
As representatives of local government authorities, themselves, State Actors, the national association should be accorded the same status. Furthermore, the national association is the interlocutor between LGAs and national government as well as vis-a-vis other stakeholders.
Developmental Actors
The national Constitution sets, as a key goal of LGAs, the promotion of infrastructural and economic development, through the formulation and execution of local development plans and the encouragement of business enterprise.
The decentralisation policy also clearly recognises the aim for the creation of LGAs as to create a democratic environment and institutions in Malawi for governance and
development; at the local level which will facilitate the participation of the grassroots in decision making. The intention is to create holistic developmental actors not agents for certain tasks.
This has clear implications for the formulation and implementation of local development plans as the responsibility of Local Government Authorities. Some of the manifestations of this are: the localisation of sector ministries activities at the local level; the need to localise the implementation of global agendas such as Sustainable Development Goals (SDGs); and the promotion of local economic development and the mobilisation of local resources.
It is increasingly recognised that development needs may not be confined to an artificially defined spatial boundaries but respond to the community needs that may span more than one administrative boundary. The territorial approach to local development (TALD) advocates for the strengthening of decentralisation through adopting a holistic developmental approach that encourages the convergence of resources to meet human development needs. It encourages partnerships between local authorities, the private sector, civil society groups, and development partners in addressing community needs.
Resources may be widely mobilized to address these needs without being handicapped by restrictive bureaucratic controls.
The main recommendations for change are –
- There is need to recognise the LGAs and their national association as Public/State Actors with a developmental mandate;
- The strengthening of decentralisation through widening the scope for development to include a territorial approach to local development;
- The holistic devolution of central sector ministries responsibilities to the local level as envisaged by the decentralisation policy.
- The localisation of global agendas such as Sustainable Development Goals (SDGs)
- Local Government Authorities take responsibility for Local Economic Development (LED) and mobilize resources from all legitimate stakeholders for enhancing the development of their territories.
2.2 Implementing the Local Authorities and the National Association of Local Authorities involvement mechanisms: information, consultation, dialogue, partnership measures
The European Union has adopted a new approach to development funding, the Neighbourhood Development and International Cooperation Instrument (NDICI) which has a geographic focus allowing country specific needs to be supported under the programme. The first programming under NDICI will be rolled out in 2021 for a period of seven years. The negotiations currently being undertaken offer opportunities for the inclusion of local government authorities together with MALGA in the programming process. The EU, in its 2013 Communication already recognised local authorities as state actors and eligible to receive support from the Union. It is, therefore, imperative, for LGAs represented by MALGA to engage both the national government and the EU Delegation to participate in the consultations to articulate and present the needs of local authorities for support. Furthermore, opportunity should be taken to seek support for the strengthening
of decentralisation through the improvement of policy and institutional capacity development.
The Pre-existing Engagement Mechanisms
Although MALGA is recognised as the representative of LGAS in Malawi its engagement with both its members and central government is constrained. At present, there is no platform for engagement between MALGA and central government sectors
Also, there is no formal platform between MALGA and the Ministry of Local Government as MALGA is considered a civil society organisation by the Ministry. However, MALGA is invited to some meetings organised by Ministry of Local Government. MALGA, however, participates at Local Government Conferences and other coordinating conferences organised by Ministry of Local Government. The main platform at which MALGA members meet with sector ministries is the MALGA Annual General Assembly organised by the association.
Area of improvement: There is need for clearer recognition of MALGA as a state actor by central government; improved communication; and closer collaboration and partnership.
Regarding development cooperation, at present, there is no formal engagement platform between local governments and the EU Delegation. Formal engagement platform is between central government represented by the Ministry of Finance and the EU Delegation
Area of improvement: Introduce formal engagement platforms between local governments represented by MALGA and the EU Delegation
Towards Enhanced Engagement for Local Authorities
Enhancing the involvement of local authorities and that of the LGAZ in the development cooperation agenda demands the active participation of LGAs themselves, especially the leadership. Although the Malawi decentralisation policy was adopted in 1998, it has never been fully implemented. While the political intent on decentralisation has not been challenged, the practice has often been to reverse the decentralisation achievements. The opportunity now exists with the new political dispensation since the elections in June 2020 ushered in a new leadership keen to embrace decentralisation. Juxtaposed with the EU NDICI programming process, there is a real opportunity for the strengthening of decentralisation. Central to this will be the position that the MALGA will take. EU programming process requires proactive initiatives. The EU programming process is intended to identify strategic priority areas and sectors for interventions to be financed under the EU cooperation within the framework of a political dialogue with central governments, local authorities and other development actors such as civil society and private sector. It is essential, therefore, to be cognisant of the necessary pre-conditions to effectively participate in the dialogue process.
First, it will be necessary for central government to embrace the state actor status of the LGAs and that of the MALGA and also in recognition of the clear stance taken by the EU 2013 Communication regarding recognition of local authorities as state actors responsible for fostering the development of their communities. The law on
decentralisation already implies holistic responsibility for development conferred on LGAs.
Secondly, the LGAs must be engaged in negotiations with central government to be on the negotiating platform for the EU programming process. The EU’s new Neighbourhood Development and International Cooperation Instrument (NDICI) under which the EU Country Programming Process for the period 2021 to 2027 is being carried out offers an opportunity to effectively strengthen local authorities’ involvement in development cooperation and benefit from the EU support. It is, thus, crucial to enter into this process with clear goals and objectives in order to derive their deserved recognition and participation in the process. It is the EU Country Delegation that will be responsible for managing the geographic component of the NDICI.
Local Authorities as State and Developmental Actors: Local authorities should take an active role in the programming process. Beyond the recognition by the EU of local authorities as state actors, the EU has also recognised them as key stakeholders in the implementation and localisation of the Sustainable Development Goals (SDG) Agenda 2030.
Following recognition of LGAs as state actors, there will be need for proper alignment of the law to the administrative machinery for realising this political goal enshrined in the country’s Constitution and decentralisation policy.
Despite this political commitment there is limited recognition of local authorities’
“general mandate” to develop their own local public policies to unlock the potential of their territories. The territorialisation of development should be an integral part of the devolution process. Local authorities should be empowered to take charge of the territorial development of their areas in a manner that permits responsiveness to communities facing common challenges even when they transcend the defined space boundaries. Such authority would enable the local authorities to take advantage of all opportunities for local economic development with excessive restrictions brought about by strict adherence to administrative boundaries. Furthermore, territorialisation of development will facilitate the mobilisation of local development across the societal spectrum bringing in the private sector, civil society, local and international partners, and other developmental stakeholders.
National Association as State Actors: The National Association represents all local governments acting as their ‘united voice’ and should also be accorded ‘state actor’ status.
Negotiations on this should be undertaken as a priority action between the national association executive committee and central government with a view to confirming the state actor status of the association, its entitlement to receive financial support from the treasury and its recognition as the interlocutor between national government and local authorities.
The following steps are proposed for local authorities and MALGA to engage in the dialogue process:
Understanding the new EU Programming Environment: The UCLG Africa has conducted an awareness raising seminar involving all national associations in Africa. The information shared and the documents disseminated during the seminar have been circulated to local
authorities to inform them of the new environment and prepare them to enter this new phase of the EU programming process.
The EU programming process is guided by its key policy documents. The following EU policy documents inform the national association in its bid to strengthen local governments participation in the programming process:
– The EU Lisbon Treaty section which recognizes the principle of subsidiarity and the Union’s own Cohesion Policies -as this would open the door to also promote territorial development in EU external action.
– The Communication of 2013 on Local Authorities and related EU commitment to
“empower” Local and Regional Governments (LRGs) as development actors and catalysts of territorial development. This would provide a clear mandate to EUDs to engage strategically with the LRGs.
– The Agenda 2030 stresses the need to “localize” the SDGs (as condition for effective implementation) and on the “5 Ps” (People, Planet, Prosperity, Peace and Partnership).
This principle strongly supports the localisation of public services and strengthens the case for local authorities to adopt the territorial approach to local development.
– The Paris Agreement and the EU Green Deal. Considering the central place of climate related issues in future programming, it will be key to ensure a clear link to the role of LRGs.
Furthermore, three guiding principles inform local authorities and national associations integration into EU programming (i) the integration of the spatial dimension in programming shifts the focus from vertical ‘silo type’ planning to holistic territorialisation of public policies; (ii) the effective integration of LRGs in the EU programming in line with the 2013 EU Communication; and (iii) the promotion of territorial approaches to local development, a concept already in sync with EU programming policy.
Engage Local Authorities: The national association will actively engage their members, provide training and launch a discussion on the strategies and priorities to present to the EU programme negotiating platform. The members will also reflect on the modalities of mainstreaming local authorities in the EU cooperation. In this regard, a seminar will be conducted bringing together local authorities to share information, discuss and produce a position paper on the 2021-2027 EU cooperation.
Engaging National Government: The national association will engage the national government department responsible for coordinating the programming process with the EU Delegation in order to, inter alia (i) define ways and means to involve local authorities in the definition of priorities aligned to national development policies; (ii) modalities for applying the subsidiarity principle for the implementation of the EU cooperation in the agreed priority areas. The association should set up a permanent mechanism for engagement to allow local authorities to input the programming process through their national association. The adoption of a place-based approach by the national level aiming at localising public national policies in all sectors of development including SDGs and other global agendas. The adoption of a Territorial Approach to Local Development (TALD) would strengthen local authorities preparing them to become strong development centres.
Engaging the EU Delegation: The national association takes positions as agreed with its membership and central government to the EU Delegation. The presentation of the agreed position paper is crucial input to the programming process. The engagement with the EU should also strengthen the results of the 2013 EU Communication on recognising local authorities as state actors in their own right. On the basis of the general mandate for developing their territories normally conferred by legislation on local authorities the national association will advocate for the entrenchment of this position to ensure that local authorities are an integral part of the negotiations process leading to the conclusion of the 2021-2027 programming process.
Roadmap to strengthen local authorities: In light of the past weaknesses and in order to ensure the consolidation of the partnership with the EU, a roadmap should be developed for the strengthening of the local authorities’ integration in the definition, implementation and follow up of the country’s priorities for inclusion in the 2021-2027 EU cooperation agenda. This roadmap elaborating the implementation of the multi annual cooperation programme will provide for sustainable engagement with the EU and national government. A key component of the resulting EU Cooperation Agenda support for the local authorities and the national association should be a capacity building programme to strengthen the Association’s institutional capacity.
Framework Partnership Agreement: To ensure that the local authorities development agenda is maintained and to ensure that it is effectively coordinated at the national level, the Association should enter an agreement with the EU Delegation for capacity development over the 2021-2027 programming period.
2.3 Funding
Although the central Government has devolved some functions to Local Authorities, the requisite financial resources to enable Councils perform such functions have not been fully devolved nor are the inter-governmental transfers adequate. Project funds allocated to LGAs have continued to dwindle as more resources have been channelled to the Members of Parliament Constituency Development Fund.
Fiscal Decentralisation
Devolution and Territorialisation of development are premised on the principle of subsidiarity under which responsibility for the provision of public services is conferred on the level closest to the citizens. It entails the transfer of functions currently carried out by central government. The redeployment of these functions to the local level will require commensurate authority to raise revenue, for example, through local taxes, service charges and fees, and licencing. These revenue assignments allow the local authority to collect revenues in their area to support public services and local development with discretion to manage the resources. This empowers the people to manage their own development by requiring local governments to respond to their needs. In Malawi, these sources of revenue are often inadequate and difficult to collect making it almost impossible for local authorities to fully carry out their responsibilities. This has forced almost total reliance on central government for funding. The LAs’ heavy reliance on the Central Government for financing, compromises the autonomy of the LAs as development act in their own right as they saying goes “He who pays the piper calls the tune”.
Inter-governmental transfers
The Decentralisation Policy specifies that 5% of national revenue, excluding grants, should be allocated to the local governments for development. The actual funding to local governments is less than 1%.
The LAs in Malawi in particular the rural councils (district councils) significantly rely on the transfers from the Central Government (80 percent for rural councils and 20 percent for urban councils) for their operations and development and in most cases the approved budget transfer estimates from the Central Government are normally cut.
Although the legal framework mandates central government to provide adequate resources to local authorities, in practice few resources go to local government for development. For example, in the 2019/2020 fiscal year, Government allocated about K8.5 billion to councils for development out of national (domestic) revenue of around K1.4 trillion, representing around 0.6%. If Government was to comply with the decentralisation policy (5%), it would have transferred about K71 billion. With this funding gap, one would argue that local governments are just implementing agencies of the central government because they cannot make their own decisions regarding development. The heavy reliance of local government on Central Government for financing compromises their autonomy as ‘development actors’ in their own right.
Budget support mechanisms
The transfer of functions from central sector ministries can be supported through budget support under which funds are allocated to local authorities to support policy reforms on the basis of an agreement that defines the envisaged changes and the results expected.
Funds are transferred into the budget of the local authority to be applied according its own systems. Accountability is based on building of effective systems to collect information and statistics on results, to monitor progress, and evaluate impact. There should be clarity on the choices of indicators, realistic targets, resource requirements and institutional set up which are all important elements for the reliability of the system.
In terms of development funding some movement was made when government in 2015/16 started devolving the District Development Budget (DDB). The establishment of DDB which is a fund for local development managed by local authorities is an important signal of that central government’s recognition and commitment to the added value of territorial approaches to local development. However, this remains a small portion as most funding such as other funding modalities such as Constituency Development Fund are not under the full control of the local authorities. Current central government fiscal decentralisation approaches embody different rules and pull in different directions. As a result mega development projects are done by Central Government, with local authorities carrying out small, micro projects that also compete on resource envelope available.
Multiple funding baskets at LA level from Central Government have led to Members of Parliament championing the increase of CDF as opposed to other funding baskets since they have much control on CDF and tend to own it yet by design CDF is for micro projects.
Territorial approach to development for macro projects is at stake and mainly on paper since District Development Fund keeps shrinking as no major support is given to it. Worse still the large development projects determined by the central government
usually do not into account local needs-based data to guide inter or intra-district allocation but are largely driven by political interests and priorities. The fact that central government does not commit to full fiscal devolution does not ensure that projects are planned and implemented by local councils. The Central government is also yet to devolve assets to the LGAs. Thus, in practice local authorities are in most cases serving as implementation agencies of the central government and not as development actors in their own right. They mostly behave as an appendage of central government because of lack of funding. Transfers made by the Central Government are not matching with the expenditure responsibilities of the local authorities. A recent study has observed that a major factor contributing to this state of affairs is that there is no fiscal decentralization policy in Malawi despite the Decentralization Policy being in force since 1998. The objective of the fiscal decentralization policy would be to provide sufficient resources, and also build the capacity of local governments to mobilize resources in order to implement their decentralized functions. This Policy is supposed to provide guidelines on the implementation of fiscal decentralization in Malawi.
An enduring observation has related to local authorities’ limited accountability and transparency in the management of their resources. The government has also moved to strengthen the National Local Government Finance Committee to oversee financial management in councils. It is also hiring more staff for the councils to oversee the financial management capacity of the Councils. Use of IFMIS and the current migration to the International Public Sector Accounting System are some indicators that local authorities are making progress on the financial management front.
Projects-based support to local development initiatives
Beyond the general public services provision special projects often require specific project funding. Funds for council operations and micro projects are provided to local governments on the basis of the council budget. However, Central government provides the celling. The actual transfer to the councils is below the budget which councils submit to Ministry of Finance as the requests are arbitrarily cut.
Projects such as district roads may require earmarked funding also including co-financing by the national government or development partners for local development projects.
The financing of local government is of critical importance for ensuring the sustainable provision of public services. Territorialisation of development and the conferring of authority to manage local revenue sources may stabilize local development financing in a sustainable manner.
LGAs produce District Development Plans (DDP) which outline key priority areas/project in a particular district. The rationale is that when central government or other non-state actors are coming up with development interventions in a particular district, the DDP is used as a shopping list for development projects and implementation of such projects following the established local structures. The DDP should be the basis for budget support to councils as they reflect the needs of each LGA.
The mobilisation of other stakeholders such as the private sector, civil society organisations and development partners will also enhance availability of resources for local development.
