The role that decentralization plays in public sector management around the world is evolving rapidly. Whereas decentralization has traditionally been pursued in countries around the world as a governance reform to increase political competition and to bring the public sector closer to the people, multilevel governance reforms to strengthen subnational governance and intergovernmental relations are increasingly understood as critical in promoting inclusive service delivery, ensuring the efficient use of public finances, and achieving resilient and sustainable development.
By its very nature, the analysis of decentralization – or multilevel governance and intergovernmental relations arrangements – is a complex and cross-cutting public policy topic. Ensuring the effective functioning of public sector across different levels of government – so that national policy objectives are achieved at the grassroots level – requires action for strengthening political, administrative, sectoral, and fiscal aspects of public sector management at the same time. Naturally, different stakeholders, often coming from different disciplines, different sectors, and different institutions, bring their own perspectives, insights, and language to the topic.
The primary objective of this primer on decentralization, multilevel governance, and intergovernmental relations is to establish a common framework and to bring common vocabulary to the topic. The idea is to guide policy makers and policy analysts to systematically identify the strengths and weaknesses of a country’s approach(es) to decentralization, multilevel governance, and intergovernmental relations, and to leverage, whenever possible, a country’s intergovernmental systems to improve the effectiveness of the public sector’s performance in achieving results.
This primer is primarily written to inform the perspective of development practitioners, policy makers and policy analysts working in a multilevel governance context. As stated earlier, pursuing inclusive and effective service delivery in a multilevel public sector requires bringing together stakeholders from across different government levels, understanding their various perspectives, and coming up with interventions and solutions that present win-win scenarios for all stakeholders involved. Therefore, this primer also offers a useful frame of reference for policy analysts, government officials, sector experts, and civil society actors involved in multilevel public sector reforms worldwide.
With this context in mind, Section 1 provides an overview of the topic by identifying why countries pursue decentralization (Section 1.1); establishing a common vocabulary around the topic (Section 1.2); providing a conceptual framework for assessing decentralization and the effectiveness of the local public sector (Section 1.3); and acknowledging the context-specific nature of decentralization as a public sector reform (Section 1.4). Section 2 recognizes that decentralization is not a one-size-fits-all reform and provides an overview of global decentralization experiences by placing country practices within a spectrum of intergovernmental institutional and fiscal arrangements. Section 3 highlights the importance of understanding the political economy of decentralization and intergovernmental relations. Finally, Section 4 highlights some issues to consider for task teams seeking to promote resilient, inclusive, sustainable, and efficient development in the context of a decentralized multilevel governance system.