Consolidating Local Governments System for achieving MDGs

The process of decentralization, in the next three to four years, requires consistent effort on the part of all stakeholders including donors, Provincial Governments and local governments. The relationships, practices and norms of democratic governance culture have to be adopted by all the stakeholders. Well designed donor programs in accordance with the LGO can contribute towards this goal. The following recommendations need to be integrated appropriately in the donor programs and projects:

Administrative decentralization:

The administrative structures, as given in the LGO, are strengthened by:

a. devolving the district and Tehsil level establishments of PHE and Housing & Physical Planning Departments to the TMAs;

b. devolving Development Authorities and WASAs to the relevant local government and budgets approved by the respective local council;

c. restructuring the Provincial Secretariat and Attached Departments to implement section 133A of the LGO;

d. enhancing the capacity of Provincial offices to perform the functions including policy analysis, oversight, checks and balances, capacity building and coordination through the Local Government Commission as given in section 132 (1)(i) of the LGO, 2001. This requires developing the necessary databases through which performance could be analyzed on monthly basis;

e. notifying the Efficiency & Disciplinary powers of the Nazims and Naib Nazim in accordance with section 30A of the LGO;

f.  creating district service in accordance with section 140-A of the LGO;

g. establishing new offices at the District level - Community Development, Registration, Information Technology, Law and Literacy; and

h. rationalizing organograms and schedule of establishments of local governments down to the lowest hierarchical level.

Enforcement of Local and Special Laws

It may be ensured that local governments, appoint Inspectors to enforce the provisions of the LGO and other local and special laws, pay bonus to Inspectors out of the fine amount, implement the provisions for on- the- spot fine by inspectors and provincial governments appoint Special Judicial Magistrates at Tehsil Headquarters.

Institutional Development:

i.   The Provincial Local Government Commissions, Provincial Finance Commissions, Zila Mushavirat Committee, Monitoring Committees and Union Public Safety Committees have requisite resources and well defined procedures to perform their assigned functions.

ii.   The office of Zila Mohtasib may be established.

iii.  Every councillor particularly the women councillors receive monthly honoraria.

iv. Nazims write the Performance Evaluation Reports of officers / officials and the reports are given due consideration by the promotion boards.

v.  Local governments at each level set up complaint cell to redress the grievances of general public.

vi. The rules for Monitoring Committees are notified.

Fiscal decentralization

i.        Provincial Finance Commissions (PFCs) may hold regular monthly meetings, monitor utilization of fiscal resources by local governments.

ii.       The PFC may have a separate budget. The structure of the Commission should be in line with its functions and appropriate professional, technical and secretarial staff may be appointed.

iii.      The rules for the PFC may be notified.

iv.      The shares of the Tehsils and Unions may be reviewed to increase these shares appropriately.

v.       The shares of local governments should be paid as a single line transfer and the local councils may exercise full powers to utilize the funds in accordance with the requirements with the local area.

vi.      All schemes relating to decentralized functions and proposed by the Provincial Government in the provincial ADP should be transferred to the respective local government budget.

vii.     All budget proposals, current and development, should be approved by the Budget and Development Committee under the Chairmanship of Zila Nazim. Thisviii.         committee should also review the progress of budget utilization on monthly basis. (viii) The erstwhile District Development Committees may be de-notified.

ix.      The TMAs and Union Administrations may maintain their accounts in accordance with the accounts manual notified by the Auditor General of Pakistan.

x.       The local councils need to elect accounts committees.

xi.      All Accounts Offices should submit the monthly accounts to the respective Nazim and the Naib Nazim. The Naib Nazim may ensure that the statement is provided to the Accounts Committee and is displayed/posted at a public place.

xii.     The Accounts Committees should meet each month, review the statements, hear the public complaints on accounts statements and discuss internal and external audit reports. The Accounts Committee may submit its report to the council.

xiii.    PIRA requirements and automation of local governments should take place simultaneously. Provincial Governments may ensure that the interface / software requirements for local governments are incorporated in the SAP software. The requirements of Drawing and Disbursing Officers may be considered while finalizing the software.

xiv.    Audit of local governments is the responsibility of the Auditor General of Pakistan. The Auditor General in consultation with the Provincial Finance Department may prepare a plan for taking over the audit functions from the Local Fund Audit Department.

xv.     Auditor General of Pakistan (AGP) / Local Fund Audit (LFA) may notify the procedure/schedule for interacting with PAOs and offices of local governments to discuss the draft audit paras. Nazims need to ensure that response on audit reports is provided to the AGP/LFA. Provincial Governments need to issue necessary instructions in this respect.

xvi.    The procedure to lay the audit reports before the local governments and its scrutiny by the Accounts Committee and the Council may be notified in the form of rules to ensure compliance.

xvii.   Local taxes may be deposited in the respective local government accounts and not in Provincial Account 1.

xviii.The property tax needs to be collected and distributed in accordance with the Local Government Ordinance. The procedure for levying tax on zero rating areas may be initiated by the local governments.

xix.     The Provincial Governments have not notified the procedure for vetting of taxation proposals.

xx.      The local governments may be required to appoint internal auditors. The Provincial Governments may notify internal audit rules.

xxi.     All local governments may ensure that the installments for CCB projects are released as soon as the formalities are completed by the concerned CCBs.

xxii.   The financial powers of the officers may be reviewed and a new delegation of financial powers schedule for local governments may be issued.

xxiii. The local government system has changed the governance structures drastically. The employees require skill development programs to learn about the new ways of improving service delivery and to dispose of the local government business. Appropriate capacity building programs may be held on regular basis.

Police Order,

i.    The composition of District Public Safety and Police Complaints Commission (DPS&PCCs) may be completed immediately.

ii.   The Provincial Public Safety and Police Complaints Commission (PPS&PCCs) may be provided adequate facilities.

iii.  Rules for public safety fund may be notified.

iv.  The donor support programs must comply with the provisions of local government ordinance, 2001 and Police Order, 2002.

Aligning Donor Support to Devolution & Mdgs

The projects and programs supported by the donors have tremendous potential to consolidate the decentralization process in Pakistan. Since the introduction of the local government system in August 2001, donors have been investing consistently to support the implementation of the Local Government Ordinance, 2001 and Police Order, 2002. The magnitude of change and the paucity of resources demands that all interventions remain devolution focused and lessons learnt through one intervention guide the subsequent programs. Ownership of the projects by the concerned local government and execution in accordance with the LGO needs to be the prime consideration in the design of projects supporting devolution. A program or project ignoring these elements may lead to sub-optimal utilization of donor funds.

The main thrust of the report is that to meet the MDGs it is critical to support the local government system in Pakistan and to resolve the issues being faced by them. The focus of the donors on the following is recommended:

i.      The local government system introduced in 2001 is the Government response for an effective service delivery. The donor programs and projects would be more effective if they remained within the parameters of the LGO and support the local government system.

ii.     The existing programs / projects must be restructured and aligned to the devolved structures. Programs supporting local governments must be steered and managed by LGC at the provincial level and local government representatives at the local level. At the provincial level the PLGC should hold the review of the progress.

iii.    Program prior actions and triggers need to be defined in consultation with the local governments and the Local Government Commissions and the Provincial Finance Commissions. Progress report from the local governments and other stakeholders need to be considered before releasing a tranche.

iv.   All financing of local government functions under the law must be through the PFC. Donors need to make efforts towards harmonizing their support through the Provincial Allocable Amount.

v.    The local governments may be adequately represented in the programs and projects.

vi.   The Executing Agency / Implementing Agency should the concerned local government for the activities relating to their functions.

vii.  Multiple administrative implementation layers which tend to centralize the financial and administrative powers, introduce parallel systems and dilute accountability may be avoided.

viii. The Councils may be involved in the approval process at the local government.

ix.    The donors may use the NGOs and CBOs to build the capacity of the local governments to implement activities especially relating to community mobilization.