Rainbow news zambia



January 15
10:23 2018

Republic of Zambia
(This Document is the Property of the Government of the Republic of Zambia)
Office of the President
Cabinet Office
P.O. Box 30208
November, 2002
Over the years since our political independence in 1964, successive Governments of our Republic
have designed and endeavoured to implement measures aimed at the attainment of full democratic
governance and economic independence with prosperity for all citizens.
In view of the highly centralized and exclusive structure and systems of government inherited
from the colonial era, the subject of decentralization has as a matter of both objective necessity and popular
demand, taken a central place in nearly all past independence government programmes of democratisation
and economic development.
Under the Third Republic therefore, Government has elaborated and adopted this policy on
decentralization whose major theme is encapsulated in its title ‘Towards Empowering the People.’ The
National Decentralisation Policy provides for the strengthening of local government to facilitate more
effective citizen participation in governance and accountable, delivery of public services as the basis for
Under the policy, district level shall be the focal point for tile planning and delivery of public
services. To facilitate operations at this level, Government will devolve specified functions, authority and
resources to Councils which are local (district) bodies comprising democratically elected representatives.
Through this Policy, the long term vision of Government is to achieve a fully decentralized and
democratically elected system of (governance characterized by open, predictable and transparent policy
making and implementation processes at all levels of the public service, effective local community
participation in decision-making and development administration while maintaining sufficient linkages
between central and local government.
To attain this vision, Government will review and streamline the current organization structures
and their supporting systems.
Government will also outline the functions to be performed at each level; national, provincial,
district and sub-district and specify the resources to be availed for the performance of these functions.
Comprehensive legislation to back the implementation of the Policy through empowering Councils to
determine, manage and control the district’s human, material and financial resources will be enacted.
However, Government realizes that currently the capacity to attain such decentralized system of
Government does not exist and has therefore, de-concentrated some of its functions, powers and resources
to provincial and district administration levels while the*necessary capacities are being developed in the
The timeframe for the implementation of the Policy is ten (10) years from the time of adoption.
The successful implementation of this Policy will require concerted efforts and the commitment of
stakeholders at all levels.
I, therefore, wish to urge all institutions and persons charged with the responsibility of implementing the
various aspects of this policy to apply themselves fully to the tasks that lie ahead.
In formulating the National Decentralisation Policy, comprehensive consultations with various
stakeholders were held in order to build consensus and create a sense of’ ownership. Due
appreciation is accordingly being extended to all stakeholders who participated in the formulation
and preparation of this Policy document. Among those consulted were:
(a) The National Steering Committee and sub-committees formed to spearhead the
development of the Policy;
(b) Chiefs, Senior Civil Servants, Councillors, members of general public and private the
general public and private sector, Non Governmental Organisations and Co-operating
Partners who attended provincial and district workshops which were conducted in
January and April 1996;
(c) Permanent Secretaries drawn from Sector Ministries and Provinces through Seminars,
Meetings and Workshops conducted in 1997, 1998 and 1999; and
(d) Committee of Permanent Secretaries drawn from Sector Ministries and Town Clerks and
Council Secretaries through a series of workshops held in 2001 for their valuable
guidance and critical comments on the drafts.
Due appreciation is also extended to the World Bank, United Nations Development Programme
and the Overseas Development Agency currently Department for International Development
through Local Government Support Project for the technical and financial support during the
development of the policy.
Autonomy: Independence in decision-making and in the execution of such decisions
within a given framework.
Community: A group of people with shared interest living in one place, district of
Council: A council is a body of democratically elected representatives responsible
for policy formulation and delivery of service in a given geographically
defined area.
Council Area: Geographical area specified under the Local Government Act so declared
by the Minister to be designated as such.
Decentralisation: Transfer of responsibilities, authority, functions, as well as power and
appropriate resources, to provincial, district and sub-district levels. This
can take four forms:
(a) deconcentration is the transfer of functions and resources to
lower level units of the same administrative system while
authority over decision-making and use of resources remains
with the centre (i.e. from the headquarters of an institution or
administrative system to the lower levels). In the case of
government administration, this would entail the transfer of
some functions performed at the headquarters of the ministry to
provincial. district and/or sub-district offices while power and
authority are retained by the centre;
(b) devolution is the transfer of some powers and authority,
functions and resources by legal and constitutional provisions to
the lower levels. The transfer is within formal political structures
and is institutionalised by constitutional means.
For example, when the central government transfers some of its
powers and authority to democratically elected councils, local
authorities or regional governments, empowering them by law,
to determine local taxes, raise own revenue and decide on how to
use it. Under this form of decentralisation leadership is
accountable to the local population through a system of
(c) delegation is the, transfer of functions and resources to a
subordinate authority with the capacity to act in the behalf
of the superior authority without a formal transfer of’ authority in
the same structure. An example is when an office of lower level
is assigned to perform some duties or tasks by the higher office.
However, the lower office will still be required to consult the
higher office on matters that require decision-making; and
(d) privatisation is the divestiture of state interests in public
enterprises and the subsequent sale of such to the private sector
(e.g. when a Parastatal national airline is sold off to private
shareholders). In the case of public administration however,
privatisation cannot be applied since local authorities and related
public offices cannot be privatised.
Development: Effective and efficient provision of quality services aimed at improving
the standard of living in a community.
District: Specified geographical area in a province declared under the Provincial
and District Boundaries Act.
Empowerment: Enabling people make decisions on issues affecting their welfare.
Local Government: This is a system of Government at local level through which local people
manage their affairs, for example Councils. and may include traditional
establishments recognised by the Government.
Provincial and
Administration: Refers to administrative arrangements for carrying out Central
Government functions at the Provincial and District levels.
Province: Specified geographical area declared under the Provincial and District
Boundaries Act.
Special –
Fund: It is funds set up to enable rural districts attract investment and retain
qualified human resources thereby ensuring sustainable decentralisation
ADC Area Development Committee
DDC District Development Committee
DDCC District Development Coordinating Committee
DPIC Decentralisation Policy Implementation Committee
NDC National Development Committee
NDCC National Development Coordinating Committee
NGOs Non-Governmental Organisations
PDCC Provincial Development Coordinating Committee

Foreword …………………………………………………………………………………………………………ii
Acknowledgement ……………………………………………………………………………………………………….iii
Working Definitions…………………………………………………………………………………………………….iv
Acronyms ………………………………………………………………………………………………………..vi
1.0 INTRODUCTION ………………………………………………………………………………………………………1
1.1 Background to Decentralisation in Zambia ………………………………………………………………….1
1.2 Need for Decentralisation………………………………………………………………………………………………6
2.0 SITUATION ANALYSIS…………………………………………………………………………………………….8
2.1 National, Provincial, District and Sub-District Administration……………………………………..8
2.1.1 Institutional Arrangements …………………………………………………………………………………………….6
2.1.2 Functions ……………………………………………………………………………………………………….10
– Development Planning ……………………………………………………………………………………………..10
– Human Resources Development and Management………………………………………………………..11
– Infrastructure Development and Maintenance ………………………………………………………………13
– Financial Mobilisation, Utilisation and Management …………………………………………………….14
2.2 Local Government Electoral System ………………………………………………………………………….16
2.3 Legal Framework ……………………………………………………………………………………………………..16
3.0 VISION AND OBJECTIVES …………………………………………………………………………………….18
3.1 Vision ……………………………………………………………………………………………………………………..18
3.2 Objectives ……………………………………………………………………………………………………….18

4.0 POLICIES MEASURES……………………………………………………………………………………………19
4.1 National, Provincial, District and Sub-District ……………………………………………………………19
4.1.1 Institutional Arrangements …………………………………………………………………………………………..19
4.1.2 Functions ……………………………………………………………………………………………………….19
4.1.3 Other Measures ……………………………………………………………………………………………………….22
– Development Planning ……………………………………………………………………………………………..22
– Human Resources Development and Management………………………………………………………..23
– Infrastructure Development and Maintenance ………………………………………………………………24
– Financial Mobilisation, Utilisation and Management …………………………………………………….24
4.2 Local Government …………………………………………………………………………………………………….25
4.1.1 Functions of Councils………………………………………………………………………………………………….25
4.1.2 Local Government Electoral System……………………………………………………………………………..25
4.3 Legal Framework ……………………………………………………………………………………………………..25
5.0 IMPLEMENTATION FRAMEWORK ……………………………………………………………………..26
5.1 Time Frame ……………………………………………………………………………………………………………….26
5.2 Institutional Arrangements …………………………………………………………………………………………..26
5.3 Reporting Relationships ………………………………………………………………………………………………27
A DECENTRALISED SYSTEM………………………………………………………………………………..27

1.1 Background to Decentralisation in Zambia
1.1.1 Zambia’s effort to decentralise its structures can be traced as far back as independence.
The effort in decentralising can be divided into five (5) phases:
Phase I – 1964 to 1970
Phase II – 1971 to 1979
Phase III – 1980 to 1990
Phase IV – 1991 to 2000
Phase V – 2000 to date
Phase 1: 1964 to 1970
1.1.2 At independence (1964), Zambia inherited a dual system of administration. The system
comprised the Field and Local Government Administration designed for colonial
convenience. The following were the administrative structures:
(a) At National level, there was the Resident Commissioner charged with overall
coordination of Provinces and Districts. The Minister of Local Government was
responsible for local government administration.
(b) At Provincial level, the Provincial Commissioner was head of provincial and
district administration and answerable to the Resident Commissioner. All civil
servants at that level were answerable to the Provincial Commissioner. However,
there was no structure of Local Government Administration at this level. The
Councils reported directly to the Ministry of Local Government at national level.
(c) Elected representatives controlled Local Government at District level (i.e.
municipality and township councils) while the Field Administration was headed
by the District Commissioner who was a Central Government representative
responsible for the supervision of all field staff in the district. The District
Commissioner was answerable to the Provincial Commissioner.
(d) At sub-district level, there existed Native Authorities, which were part of Local
1. 1.3 From 1965, the Government established the following -administrative structures:
(a) At National Level, the Ministry responsible for Local Government headed by a
Cabinet Minister for policy direction, and Permanent Secretary for
administration, was established for the supervision of local authorities. In
addition, Line Ministries headed by Permanent Secretaries were also established
and reported to Cabinet Office for administration.
(b) The Provincial Administration was headed by a Cabinet Minister appointed by
the President and was assisted by a Resident Secretary who was a civil servant
appointed by the Public Service Commission. The Cabinet Minister was
answerable to the President, while the Resident Secretary was answerable to the
Secretary to the Cabinet. There was no linkage with local government at this
(c) At District level from 1967, the District Secretary replaced the District
Commissioner as head of district administration. In 1968, the President appointed
the District Governor as political head of the district. The District Secretary
continued as head of field administration and was appointed by the Public Service
(d) The Local Authorities, namely; Municipal, Rural and Township Councils as
provided for under the 1965 Local Government Act, operated independently from
district administration. The Councils were headed by the Mayors/Chairmen who
were elected political heads of the council. The Town Clerks/Council/Secretaries
were administrative heads of’ local authorities and were appointed by their
respective councils.
1.1.4 Institutional framework for coordination of development in this Phase I included the
following structures:
(a) At National level, there was the National Development Committee (NDC)
comprising all Line Ministries;
(b) At Provincial level, there existed the Provincial Development Committee (PDC)
chaired by the Provincial Minister. The PDC scrutinised all district development
requests and forwarded them to the NDC for further scrutiny and budgetary
support; and
(c) At District level, there was the District Development Committee (DDC) chaired
by the District Secretary up to 1967 and by the District Governor after 1968.The
DDC consolidated the district development requirements and forwarded them to
the PDC for scrutiny and submission to the NDC.
1.1.5 Experiences under this Phase were:
(a) Centralisation of’ authority, which led to inefficiency in service delivery. For
example, at district level, district heads of Field Administration were controlled
from the province. The Public Service Commission and Ministry Permanent
Secretaries appointed the officials. The lower level institutions like PDC and
DDC had neither authority to make decisions nor to source for funds. The
financial resources were sourced and allocated by the centre;

(b) Duplication of effort at district and provincial levels became the order of the day
resulting into wastage of resource. For example, in any given district the
Department of Water Affairs sunk boreholes and Roads Department worked on
feeder roads while Councils also sunk boreholes and worked on feeder roads,
under separate programmes; and
(c) The existence of dual structures at district level i.e. Local Government (Council)
and District Administration were:
(i) costly to the Government since Local Government and District
Administrations were both funded from the central treasury; and
(ii) a source of conflict as the provincial heads departments operated under
the authority from the centre, while their allegiance was not to the
Resident Secretary at the Provincial level but their respective Permanent
Secretaries at the Centre.
Phase ll: 1971 to 1979
1.1.6 From 1971 to 1979, Government retained the structures established between 1964 and
1970 with the exception of the Native Authorities, which were abolished in 1965. In
addition, under the 1979 Village Development and Registration Act, 30, Government
created the Ward Development Committee and Village Development Committees. The
village became the primary focus for local development wit emphasis on self reliance and
mutual cooperation enhanced through cooperatives.
1.1.7 The experiences under this phase were similar to the first phase. However, in this phase
there was noticeable political interference in administration and coordination of
development programmes.
Phase Ill: 1980 to 1990
1.1.8 In 1980, Central and Local Government Administration were merged with Party
Administration. The later became supreme. Under this arrangement, Government
established the following:
(a) At National level, the Ministry of Decentralisation was created in the Office of
the Prime Minister assisted by a Minister of State;
(b) At Provincial level Members, the Central Committee of Central Committee by
the Provincial Political Secretary and Permanent Secretary was head of
administration. In some provinces there were two Provincial Political Secretaries.
one for Political and the other Development; and

(c) At District level, the District Governor who was a political appointee headed the
integrated district administration. The District Governor was Chairperson of the
District Council and was assisted by the District Executive Secretary who headed
the district secretariat. The District Council was supported by Party structure
Ward, Branch and Section Committees. Local Government elections were
abolished and replaced by party elections. The structures were modelled on
socialist lines and community participation was restricted to party cadres.
1. 1.9 The experiences under this Phase were:
(a) By merging Party, Local Government and District Administration, it enhanced
supremacy of the Party as opposed to facilitating the coordination of
development programmes;
(b) The supremacy of the party led to the centralization of authority into the hands of
party functionaries;
(c) The appointment of the District Governor as Chairperson of the Council
undermined democratic governance in the civic politics;
(d) Central Government functions were transferred to the district level without
matching resources. For example, the registration of villages, construction of
feeder roads, and water supply schemes were all transferred to Local Authorities
without matching resources; and
(e) The integrated district administration system, resulted into bloated administrative
structures at all levels, with most key positions filled by party cadres resulting in
ineffective service delivery and wastage.
Phase IV: 1991 to 2000
1.1.10 With the introduction of multi-party democracy from the one Party State, the following
changes were made:
(a) At National level, the Ministry of Decentralisation was transformed to the
Ministry of Local Government and Housing. This Ministry was responsible for
local government while Cabinet Office was responsible for Provincial and
District Administration;
(b) At Provincial level, the Deputy Minister was appointed as head of Provincial
Administration and assisted by the Permanent Secretary. The Provincial heads of
departments continued to be answerable to their respective Ministry
Headquarters; and

(c) At District level, there was no head of district administration to coordinate all
sectors of government. The Town Clerk or District Council Secretary
coordinated sector Ministry activities on administrative arrangement introduced
in 1995. The Councils remained body corporate and operated independently from
district field administration.
1.1.11 In 1995, the Government introduced the National, Provincial and District Development
Coordinating Committees to coordinate activities at respective levels.
1.1.12 The experiences under this Phase included the following:
(a) Centralisation of authority continued to be a bottleneck for effective decision
making at lower levels. For example, the provincial heads of departments were
controlled from the centre and – their budgetary allocations determined from
(b) The absence of a head of district administration led to ineffective coordination of
development programmes in the district. The District Development Coordinating
Committee (DDCC) chaired by the Town Clerk or Council Secretary did not
perform to Government’s satisfaction. The major reason was the lack of legal
framework to back the operations of the DDCC; and
(c) Lack of involvement of communities in development programmes. The current
administrative system does not provide for the establishment of sub-structures at
sub- district level to enable local communities participate effectively in their
development activities and local affairs.
Phase V: 2000 to date
At both National and Provincial levels, the structures have remained the same. However,
the functions and reporting relationship have changed slightly. The President appointed
District Administrators in 2000.
1.1.13 While the District Administrators report directly to the appointing authority, the Town
Clerks/Council Secretaries report to the Council who are their employers. In addition, the
Councils have remained body corporate, operating independently from field
administration at district level. The District Heads of Sector Ministries report directly to
their Ministerial Headquarters through their provincial heads.
1.1.14 The experiences in this Phase are the same as those alluded to under the immediate
previous phase.
1.1.15 In addition, the establishment of District Administrator’s Office has strengthened the dual
system at the district level instead of blending which is the ultimate goal of
1.2 Need for Decentralisation
1.2 The objectives of Decentralisation in Zambia stems from the need for the citizenry to
exercise control over its local affairs and foster meaningful development which requires
that some degree of authority is decentralised to provincial, district and sub-district levels
as well as Councils, in the background of centralisation of power, authority, resources
and functions, which has in turn subjected institutions at provincial, district and subdistrict
levels to absolute control by the centre. In order to remove the absolute control by
the centre, it is necessary to transfer the authority, functions and responsibilities, with
matching resources to lower levels.
1.2.2 There are four principle forms of decentralisation. namely: deconcentration, delegation,
devolution and privatisation
1.2.3 While deconcentration and delegation transfers resources to lower level and subordinate
authority, they have a tendency of concentrating authority in the hands of higher
authorities and thus accountability is still left to the centre. Further, although
deconcentration and delegation can pursue the technical efficiency leading to greater
effectiveness, these forms decentralisation cannot effectively enhance the decentralised
system of administration. Consequently, popular participation may not be realised.
Privatisation is the empowerment of the people to fully, and effectively participate in the
management of their enterprises. Privatisation on the other hand cannot be applied to
public administration since local authorities and related public offices cannot be
1.2.4 Decentralisation, if properly implemented can lead to efficient and effective delivery of
services. Decentralisation through devolution would be most effective as it ensures
technical efficiency and effectiveness in service delivery and enhances popular
participation. The fundamental reasons for adopting “devolution” as the form of
decentralisation in a unitary state like Zambia are varied.
(a) Firstly, the 1996 Constitution of Zambia recognises the equal worth of’ men and
women in their rights to participate and to freely determine and build political,
economic and social systems of their own choice. The Constitution further
resolves to uphold the values of democracy, transparency, accountability and
good governance; and
(b) Secondly, the Government’s approved Public Service Reform Programme
(PSRP) and the National Capacity Building Programme for Good Governance
emphasise the need for effective decentralisation of’ selected functions and
responsibilities from the central government to the provinces and districts and
ultimately the Councils to facilitate democratic governance and delivery of’
quality and demand-driven services to local communities.

1.2.5 The following are the expected benefits from the devolved system of’ decentralisation:
(a) Political stability will be secured by active participation of the local people in
development activities and in politics through voting and other practices such as
civic education which will strengthen democratic accountability;
(b) Lower level participation in development and politics would be a basis for
training in political leadership which would create a seedbed for prospective
political leaders to develop skills in policy-making, political party operations and
budgeting with the result that the quality of political leadership will be enhanced;
(c) Accountability will be enhanced because local representatives will be more
accessible to the local populace and will thus be held more closely accountable
for their policies and outcomes than distant national political leaders (or public
servants). A vote at local elections would be a unique mechanism for the local
community to register its satisfaction or dissatisfaction with the performance of
its representatives;
(d) Responsiveness of government will be improved because local representatives
will be best placed to know the exact nature of local needs and how they can be
met in a cost-effective way;
(c) Locally specified plans will be tailor-made for local area using detailed and up to
date information; and
(f) Motivation of field-level personnel will be enhanced when they have greater
responsibility for the programmes they manage.
2.1 National, Provincial, District and Sub-District Administration
2.1.1 Institutional Arrangements At national level, there exists the Cabinet Office, which is responsible for the
management and coordination of the Public Service. The Secretary to the Cabinet is
head of Government Administration, which comprises sector Ministries and statutory
bodies, Provincial and District administration. In order to enhance the operations at
National level, Cabinet Office is expected t~ coordinate development activities through
the National Development Coordinating Committee (NDCC). At each Provincial level, there is the Provincial Administration Headquarters headed by
a Deputy Minister assisted by a Permanent Secretary responsible for the coordination
of Government business in the Province. Apart from this office, there are Provincial
Heads of Departments through whom functions of sector Ministries are carried out.
Provincial Heads of Departments are answerable to their respective Sector Ministries
on technical matters but administratively supervised by the Permanent Secretaries for
the Province on day-to-day administration. To enhance the operations of the Provincial Administration, Government through
Circulars has established the Provincial Development Coordinating Committee (PDCC)
as a forum for coordinating the planning, implementation and monitoring of
development activities at the Provincial level. The PDCC is, however, ineffective
because its creation and existence is not backed by any legal framework. Equally, the
Permanent Secretaries of the Provinces, who are the chairpersons of the PDCC, have
no legal powers to supervise and discipline sector ministry personnel. At the District level, there is District Administration headed by a District Administrator
who is responsible for coordinating developmental activities. District Administration
comprises various sector Ministerial departments performing specified Government
functions and responsible for implementing programmes and report to their respective
Provincial heads of department. In order to enhance the operations of District
Administration, Government through Circulars established DDCC as a forum for
coordinating the planning and implementation of development activities at the District
level. The District Development Coordinating Committee is ineffective because no legal
framework backs its operations. Town Clerks and Council Secretaries who, until the
appointment of District Administrators, were chairing the DDCCs had no legal backing
to supervise and discipline sector Ministry personnel operating at the District level. In
addition, there are semi-autonomous institutions of local governance, such as, Health
and Education Management Boards created to perform specified functions on behalf of
sector Ministries aimed at increasing community participation in the planning and
delivery of services.
8 As regards local Government, there is a single-tier system of local government
comprising three types of councils, namely: City, Municipal and District Councils
responsible for the provision of services. The second schedule (section 61), of the
Local Government Act Cap 281 prescribes sixty-three (63) functions to be performed
by all Councils regardless of their status and capacity. The assignment of the
sixty-three functions listed under the Act without taking into account capacity, results
in Councils not performing to the satisfaction of their local communities. Although
these institutions are body Corporate, they also perform delegated functions of the
Central Government. The Mayor/Council Chairperson is a political head of the Council and, performs
ceremonial functions. However, there is a weak link between the Mayor/Council
Chairperson and the Ministry of Local Government and Housing which has led to lack
of co-ordination, transparency and accountability on civic matters. There are wards, which are sub-structures of the councils at sub-district level for the
purposes of Local Government Elections only. The Registration and Development of
Villages Act establishes the Ward Development Committees and Village Productivity
Committees in each ward as a forum for community participation in local development
activities and affairs. However, these institutions are not linked to Local Government
and are no longer functional in most districts. This has led to lack of forum for
community participation in decision-making on their local development activities and
affairs at sub-district level. At lower level there exists, traditional rulers with their own administrative set up to
govern their subjects in line with their traditional and customary law.
Challenges The challenges facing the current institutional arrangements relating to Government
structures and functions are:
(a) the coordination role of the Provincial Administration is undermined by the
existence of some Provincial and District Heads of Departments who report
directly to their sector Ministry Headquarters;

(b) the existence of parallel administration structures at District level;
(c) the absence of a legally appointed overall Coordinator of’ development at that
level has created a vacuum leading to ineffective coordination of’ development
activities and policy implementation;
(d) the absence of Sub-District level coordinating structures results in poor
consultation among the key players at this level, thereby impairing efficient
and effective service provision and development in response to local needs;
(e) unclear mandate and guidelines stipulating the deconcentrated and devolved
functions to be performed by Sector Ministries’ departments and the Councils
respectively at the District level leads to failure to perform the prescribed
(f) lack of a clear line of authority and reporting relationship between Permanent
Secretaries of the Provinces and Councils leads to conflict and
(g) provision of’ clear line of authority and reporting relationship between
Mayor/Council Chairperson, Ministry of’ Local Government and Housing and
Provincial Administration;
(h) establishment of formal forum at ward and village levels; and
(i) provision of logistic support to local level leadership.
2.1.2 Functions
Development Planning At national level, Sector Ministries prepare plans based on their core functions
submitted to Ministry of’ Finance and National Planning for funding. Although Sector
Ministerial plans were to be submitted to the NDCC for scrutiny and approval, this has
not been the case due to administrative and management problems. At Provincial level, although these institutions plan their development activities there is
a weak link between the planning process in the Provinces and National Budget which
has led to:-
(a) under funding of proposed projects and programmes;
(b) Marginalisation of needy areas when allocating resources; and
(c) Mismanagement of resources. Although the PDCC exists, the operations of this forum have been marginalized due to
lack of legal backing. Further, the decisions made by PDCC are not considered by
NDCC, which has never met. At District level, there is poor and uncoordinated planning due to lack of resources.
Although, the DDCC exists, the operations of this forum have been ineffective in most
districts due to lack of’ legal backing. This situation is worsened by lack of feedback
from the PDCC and NDCC.
Challenges The challenges relating to development planning which will be addressed in the
Implementation of this policy are:
(a) none operationalisation of the NDCC which has affected the dissemination of’
Government policies and implementation of programmes;
(b) the weak linkage between the planning and national budgeting process;
(c) the absence of’ planning units in most Districts has adversely affected the
development planning at that level; and
(d) the need to involve local people in the planning process.
Human Resources Development and Management: At Central level, the overall human resources management function in the Civil Service
is the responsibility of the Public Service Management Division. However recruitment,
placement, promotion and transfer of staff in the Civil Service are vested in centralised
Commissions, namely; the Public Service Commission (PSC) Police and Prison
Service Commission and Teaching Service Commission. The Public Service
Commission has delegated the responsibility of recruiting and disciplining staff from
Division III and below to Permanent Secretaries in sector Ministries. Their respective
Service Regulations and General Orders guide these institutions. The centralisation of’
appointments, promotions and disciplinary control under the Service Commissions
undermines the role of Permanent Secretaries and Heads of Department management
of human resources under their control and is not consistent with the modem
management practices. In addition, lack of comprehensive National Employment
Policy has led to misplacement of personnel and over employment.
11 At Provincial level, the PSC has delegated the responsibility of recruiting and
disciplining staff from Division III to the Permanent Secretary. As Local Authorities,
the Provincial Local Government Appeals Board has been established to consider
appeals from aggrieved employees. At District level, the Local Government (Amendment) Act No.30 of 1995 empowered
Councils to appoint and discipline their personnel without reference to the Minister
responsible for Local Government. The Act also abolished the Local Government
Service Commission and in its place established the Provincial Local Government
Appeals Boards. Although the responsibility for recruitment of staff has been vested in
individual Councils, currently there is no recruitment policy to guide the process. There
is a presumption that the appointments will be on merit and good performance, but the
means of assuring merit or performance are not defined. As a result, staff, are often
promoted to posts they are not qualified or experienced enough to hold, resulting in
poor service provision to communities. The function of human resources development has been decentralised from the
Department of Human Resources Development at Cabinet Office and made the
responsibility of sector Ministries. This has meant that sector Ministries have to plan
and budget for the development of their staff. At Provincial level, each Provincial Administration is expected to budget for training of
its staff. Councils on the other hand, are responsible for the development of their staff with the
assistance of the Ministry of Local Government and Housing. Staff at all levels undergo training mainly at local universities, technical institutions,
colleges and polytechnics. However, the capacity of these institutions has been
adversely affected by lack of a comprehensive, National Training Policy, poor
infrastructure financial constraints low quality of training materials, shortage of
approximately qualified teaching staff and poor management. In addition, there is weak
coordination among sector Ministries resulting in the production of sub- standard
graduates from their various institutions.
Challenges The challenges facing human resources development and management are the:
(a) provision of a comprehensive National Employment Policy;
(b) redefinition of the role of the Service Commissions;
(c) provision of effective management systems;
(d) provision of a comprehensive National Training Policy;
(e) development of capacity for Councils to pay skilled labour;
(f) development of staff recruitment guidelines for Councils;
(g) development and maintenance of infrastructure in training institutions; and
(h) effective coordination among sector Ministries.
Infrastructure Development and Maintenance The socio-economic infrastructure such as roads, waterworks, telecommunication,
hospitals, schools, colleges and universities, office accommodation and institutional
houses are in a state of disrepair due to lack of maintenance. The current state of the
physical infrastructure has continued to deteriorate rendering the institutions at all
levels virtually incapable of providing quality services to the growing population.
Virtually all sector Ministry Departments particularly at Provincial and District levels
are without serviceable plant and equipment. This situation has been further
compounded by lack of a clear policy and insufficient financing for the development
and maintenance of the infrastructure. Lack of technical know-how to correctly and
fully utilise and maintain plant and equipment, coupled with the rise in the rate of
vandalism of public property, have worsened the situation. Although attempts are being made by Government through various sector Ministries
operating at District level and Communities, with the assistance of Co-operating
Partners to rehabilitate existing infrastructure, develop new ones and promote a culture
of preventive maintenance, much more remains to be done.
Challenges The major challenges in the development, provision and maintenance of infrastructure are:
(a) development of clear and comprehensive policy;
(h) providing adequate resources, both human and financial;
(c) developing management capacity; and
(d) promoting a culture of preventive maintenance.
Financial Mobilisation, Utilisation and Management The Ministry of Finance and National Planning has the overall responsibility for the
management of financial resources for the country. After the Budget has been approved
by Parliament, financial allocations are made to the Permanent Secretaries of Sector
Ministries and Provinces for onward disbursement to the various sectors, institutions
and departments. Controlling Officers are accountable to the Public Accounts
Committee of Parliament for the utilisation of these funds. The Ministry of Local Government and Housing has since Independence played a dual
role as a sector Ministry and as a Ministry responsible for Councils. Its functions in as
far as mobilisation of’ financial resources is concerned, has included budgeting and
securing funding for its own operations and sourcing capital and recurrent (grants)
funding from the Central Government and Co-operating Partners for the operations of’
Councils. The Ministry of Local Government and Housing has also the responsibility
of issuing financial regulations in the management of financial affairs and providing
external auditing services to Councils. Until the early 1980s, the Ministry of Local Government and received adequate
financial resources (grants) from the Central Government and disbursed them to
Councils. In addition, prior to the early 1980s, when the national economy was strong
there was in elaborate grant payment system whereby sector Ministries provided
specified grants to support Councils to undertake the delegated functions on their
behalf. During this period, 70%o of he income of Councils came from the Central
Government through the Ministry of Local Government and Housing as grants, while
30% was met by revenue raised from local levies, fees and charges as well as specified
funds from other Sector Ministries whose functions they performed.
14 Transfers of finances by the Central Government to Councils take the form of: General,
Special and Capital grants. Capital grants are grants meant to finance capital projects
while General grants are additional financial resources extended to local government
for use at their own discretion. Special grant are used to finance prior-earmarked tasks
by the Central Government. Transfers from Central Government in the form of grants
were supposed to be one major revenue source for Councils for two main reasons.
Firstly, it was the mechanism through which shared taxes were transmitted from the
Central Government to the Councils. Secondly, it was the conduit by which the Central
Government provided financial resources to the Councils to carry out specific functions
on its behalf. In addition to grants, Councils have powers under the various Local Government Acts
to raise and utilise revenue from their own local sources at their discretion. However,
their revenue base was reduced in 1992 when Central Government directed Councils to
disinvest in commercial ventures and to sale its housing stock at uneconomical prices.
This is compounded by Government’s failure to honour statutory obligations and
inability to pay for services rendered. Further, poor management of resources has
worsened the situation. The 1980 Local Administration Reforms involved extensive devolution of central
powers and functions to Councils but owing to poor performance of the economy,
matching resources were not transferred or maintained at reasonable levels.
Consequently, the reform initiatives failed and Councils remained critically constrained
by lack of financial resources In addition, even in instances where funds have been available, centralised planning
and budgeting has not adequately addressed the needs and priorities of the districts. The
situation has further been compounded by the lack of a district integrated budgeting
The challenges relating to financial mobilisation and management are:
(a) introducing decentralised financial resources mobilisation;
(h) providing a formula for allocating funds from the Central Government to
Districts for effective and efficient service delivery;
(c) providing a system of releasing resources to sector Ministries, Provinces and
Councils to ensure timely implementation of development programmes and
(d) strengthening Central Government’s auditing system to ensure discipline in the
handling of financial affairs of Councils;
(e) building capacity in resource mobilisation and financial management of
Councils; and
(f) updating financial regulations for effective management of financial resources.
2.2 Local Government Electoral System
2.2.1 The Constitution under Part VIII provides that there shall be a democratically elected
local government system. Further, the law provides that Mayor/Council Chairperson
should be elected by Councillors. This means that there is no community participation in
choosing their civic leader. Citizens only involved at election time. Thereafter, there is no
mechanism in place to enable them influence local affairs. The Mayor/Council
Chairpersons are therefore accountable to the Councillors who vote them in office than to
2.2.2 The Mayor/Council Chairperson as ceremonial head of the Council, lacks powers to
supervise and discipline councillors and council staff as such powers are in the Council.
2.2.3 The challenges relating to Local Government Electoral System are:
(a) to make the Mayor/Chairperson accountable to the general public in the Council
(b) to empower the Mayor/Council Chairperson to enforce implementation of
Council resolutions by officials; and
(c) empower the Mayor/Council Chairperson to enforce discipline.
2.3 Legal Framework
2. 3. 1 There are various pieces of legislation relating to decentralisation. These include the
(a) Local Government Act Cap 281 of the Laws of-Zambia, which established the
(b) Provincial and District Boundaries Act Cap 286 of the Laws of Zambia, which
empowers the P resident of the Republic of Zambia to sub-divide the Country
into the Provinces and Districts;
(c) Village Registration and Development Act No. 30 of 1971 which provides for the
establishment of Village Productivity Committees as fora for community
participation in decision making and development at these levels; and
(d) Local Government Electoral Act.
2.3.2 There are thirty-two pieces of legislation on the administration of the local government.
In view of the large number of disjointed legislation, it has been difficult to enforce all of
them effectively. For example, the Markets Act Cap 473, Control of Dogs Act, Cap 381,
Extermination of Mosquitoes Act, Cap 537 and others, have not been effectively
enforced. This has led to some members of the general public not adhering to the
provisions of the law without being prosecuted. Further, Councils are allowed to make
by-laws. However, these by- laws have to be approved by the Central Government.
2.3.3 The challenges relating to the legal framework are:
(a) provision of a principal and comprehensive legislation to support and guide
decentralisation; and
(b) removing bureaucratic requirements that Councils’ by- laws and budgets should
be approved by Central Government.
3.1 Vision
3.1.1 The vision of Government to achieve a fully decentralised and democratically elected
system of governance characterised by open, predictable and transparent policy making
and implementation processes, effective community participation in decision-making,
development and administration of their local affairs while maintaining sufficient
linkages between the centre and the periphery.
3.2 Objectives
3.1.1 In order to achieve the Government’s vision, the following policy objectives will be
(a) empower local communities by devolving decision making, function and
resources from the Centre to the lowest level with matching resources in order to
improve efficiency and effectiveness in the delivery of services;
(b) design and implement a mechanism to ensure a “bottom up” flow of integrated
development planning and budgeting from the District to the Central
(c) enhance local political and administrative authority in order to effectively and
efficiently deliver services;
(d) promote accountability and transparency in the management and utilisation of
(e) develop the capacity of Local Authorities and communities in development
planning, financing, co-ordinating and managing the delivery of services in their
(f) build capacity for development and maintenance of infrastructure at local level;
(g) introduce an integrated budget for district development and management; and
(h) provide a legal and institutional framework to promote autonomy in decision
making at local level.
4.1 National, Provincial, District and Sub-District
4.1.1 Institutional Arrangements In order to achieve the stated vision, Government will establish a new decentralised
structure of governance, backed by law, through which services will be delivered. The new structure will comprise four levels namely National, Provincial, District and
Sub-district. In this decentralised structure the Province will be streamlined because it is an important
link between the centre and the district. The District shall be the focus for development
and service delivery, thus empowering local communities to play an effective role in
national affairs. At the district level, there shall be a system of Local Government based
on democratically elected councils on the basis of universal adult suffrage. The
sub-district level shall be introduced.
4.1.2 Functions Decentralisation will riot necessarily imply that all authority will be transferred to local
authorities. The Central Government (including line ministries) will retain a core of
functions over essential national matters and ultimately have the authority to redesign the
system of government and to discipline or suspend decentralised units that are not
performing effectively. Specifically, the Central Government will retain the overall
responsibility of:
(a) general and legislative Policy formulation, monitoring and evaluation and
provision of advice to Councils on their operations;
(b) setting national performance standards;
(c) controlling arms, ammunition and explosives;
(d) national defence and security;
(c) regulating banks and financial institutions, promissory notes, currency, and
(f) citizenship, immigration emigration. refugees, deportation, extradition and
designing of passports and national identities;
(g) copyrights, patents, trademarks and all forms of intellectual property,
incorporation and regulation of business organisations;
(h) control of state land and minerals;
(i) declaration of public holidays, working and shopping hours;
(j) preservation of national monuments, antiquities, archives and public records;
(k) foreign relations and trade, regulation of trade and commerce;
(l) national and local government elections;
(m) guidelines on national census and statistics;
(n) control of publications of national surveys and mapping;
(o) control and management epidemics, pandemics and disasters;
(p) airports, aerodromes and air strips;
(q) national development projects and programmes;
(r) correctional policy and maximum security prisons;
(s) trunk roads and highways;
(t) prosecutorial functions;
(u) high school and tertiary education; and
(v) any other functions delegated by Parliament. At the Provincial level, functions to be performed include:
(a) co-ordinating and consolidating district plans into provincial development plans
for submission to the centre;
(b) monitoring the utilisation of resources and implementation of development
programmes in the province;
(c) coordinating and auditing of local institutions;
(d) preparing provincial progress reports for the central Government on the
implementation of development programmes and projects;
(e) ensuring implementation of Central Government policies and regulations;
(f) implementation of National development projects and programmes which cut
across sectors;
(g) ensuring proper utilisation and maintenance of Government buildings,
equipment, plant and other infrastructure; and
(h) any other functions delegated from the centre. The Government shall decentralise with matching resources, some of its function& to the
district, which shall perform these functions through democratically elected councils. The
Councils will raise part of their own revenue and receive grants from central treasury and
line ministries to perform the devolved functions such as’.
(a) coordination of decentralised structures, including Health and Education Boards;
(b) disaster management;
(c) community development;
(d) primary health care;
(c) primary and basic education;
(f) water and sanitation;
(g) rehabilitation, maintenance and construction of feeder roads;
(h) infrastructure development and maintenance;
(i) planning and implementation of development projects and programmes;
(j) mobilisation of local resources;
(k) preparation of progress reports for the province;
(1) management, conservation of natural and wildlife resources;
(m) environmental services;
(n) provision and maintenance of public amenities;
(o) land allocation and utilisation;
(p) trade and business licensing;
(q) agriculture extension services;
(r) bye-laws;
(s) community Police Service;
(t) community Prisons Service;
(u) youth and juvenile delinquency; and
(v) any other functions as delegated from the centre. The Government will build capacity of Councils to perform core management functions
such as planning and budgeting, personnel and financial management as well as delivery
of public services. The Government will contribute towards the provision and delivery of some public
services while developing capacities of the Councils. When the management capacity has
been built, Councils will be given more authority and higher degree of autonomy while
maintaining sufficient linkages with the centre as demanded in unitary state. However,
this is a long term task requiring an evolutionary approach. Government will ensure that sub-district structures are established for the effective and
efficient delivery of services. The functions to be performed will include promotion of
community participation in decision making development planning and implementation.
4.1.3 Other Measures
Development Planning In order to address the challenges relating to development planning, Government will:
(a) provide a legal backing to the development planning process and output;
(b) link the operations of Area Development Committees (ADCs), DDCCs, PDCCs
and NDCCs through the submission of reports and feedback;
(c) facilitate the establishment of District Planning Units managed by qualified
personnel; and
(d) devise mechanisms for strengthening the linkage between planning and national
budgeting process.
Human Resource Development and Management
3.2 To address issues related to development and management of human resources
Government will:
(a) develop a comprehensive National Employment Policy categorising functions
and responsibilities at each level;
(b) restructure and redefine the role of all the Service Commissions in order to
ensure that they do not deal with the day-to-day functions of recruitment,
promotions. transfers and discipline because these will be the responsibility of
sector Ministries, Provinces and Districts. The Commissions’ role shall be
restricted to issuing guidelines, monitoring and as appellant bodies of last resort,
(c) assist Councils to devise and introduce performance, management and appraisal
systems for effective and improved service delivery;
(d) grant Councils powers to manage and develop human resources in their areas;
(e) ensure that the decentralised functions are accompanied by appropriately,
qualified staff to be surrendered from the national and provincial levels with
specified job descriptions and conditions of service and entitlement;
(f) ensure that establishments of Councils are based on their capacity to pay and
services to be delivered;
(g) develop a comprehensive National Training Policy which should be adaptable to
local needs;
(h) ensure that Councils devise appropriate human resource development
programmes based on the identified training needs for Councillors and officials;
(i) local training institutions for effective development.
Infrastructure Development and Maintenance In order to address challenges relating to infrastructure development maintenance, the
Government will:
(a) develop a comprehensive policy on infrastructure development and management;
(b) provide adequate resources in the National budget;
(c) release resources as approved by Parliament;
(d) design and implement capacity building programmes for infrastructure
development and maintenance responsive to the needs of local communities; and
(e) include a culture of preventative maintenance at all levels
Financial Mobilisation and Management To carry out the decentralised functions on a sustainable basis, Government will:

(a) devise a mechanism for mobilising of local financial resources;
(b) introduce participatory budgeting for development activities at the district level;
(c) devise formulae for disbursement of funds to Councils;
(d) establish a special Equalisation Fund to enable rural district attract Investments
and retain qualified human resources thereby ensuring sustainable
(e) enact a legislation, which will ensure adherence to timely release of funds by
Ministry of Finance and National Planning as approved by Parliament;
(f) establish District Tender Committees in order to enhance checks and balances in
the procurement of goods and services;
(g) devise and implement appropriate financial management systems to strengthen
financial management, transparency and accountability in Councils;
(h) introduce a District Integrated Fund and Budget for district development; and
(i) transfer the Local Government Finance and Audit Section under the Ministry of
Local Government and Housing to the Office of the Auditor-General in order to
enhance capacity and ensure timely auditing of books of accounts of the
4.2 Local Government
4.22.1 Functions of Councils The Councils shall continue to perform their statutory functions in conjunction with the
decentralised functions as stipulated in this document. The Mayor/Council Chairperson will oversee the administration of the Council and shall
preside over council meetings. The Mayor/Council Chairperson shall be accountable to
the electorate and will co-ordinate with the Provincial Administration on all matters of
local governance in the District.
4.2.2 Local Government Electoral System A Mayor/Council Chairperson elected by universal suffrage in the Council area will head
the Council. In order to redress the challenges associated with the Local Government
electoral System, the system of Local Government shall be based on democratically
elected Councils on the basis of universal adult suffrage as provided for in the
4.3 Legal Framework
4.3.1 In order to address the issue related to legal framework, the Government will review
existing legislation and establish a comprehensive legal framework on decentralisation.
5.1 Time Frame
5.1.1 The time frame for the implementation of this policy is ten (10) years from the time of
this adoption.
5.2 Institutional Arrangements
5.2.1 At the national level, an ad-hoc Decentralisation Policy Implementation Committee
(DPIC) will be established to provide leadership and direction on the implementation
process. The DPIC will he serviced by a Secretariat comprising of Officers from the
Policy Analysis and Coordination Division, Management Development Division and
Ministry of Local Government Housing. The DPIC will, be phased out when the capacity
in the Councils has been built. The committee will comprise:
(a) Ministry of Local Government and Housing;
(b) Management Development Division, Cabinet Office;
(c) Policy Analysis and Coordination Division, Cabinet Office;
(d) Ministry of Education;
(e) Ministry of Finance and National Planning;
(f) Ministry of Agriculture and Co-operatives
(g) Ministry of Health;
(h) Ministry of Community Development and Social Services;
(i) Ministry of Home Affairs;
(j) Ministry of Sports, Youth and Child Development;
(k) Ministry of Lands;
(l) Ministry of Science, Technology and Vocation Training; and
(m) Ministry of Legal Affairs.
5.2.2 At the provincial level, the Permanent Secretaries will facilitate, coordinate and oversee
the implementation of capacity, building programmes in their respective Provinces with
the assistance of the DPIC.
5.2.3 At the district level, there will he a Council, composed of elected representatives,
responsible for the delivering of services and a Government representative, appointed by
the Public Service Commission, to monitor operations.
5.2.4 At sub-district level, Area Development Committees (ADCs) will he established in each
ward. The nature of ADCs will vary between urban and rural districts.
5.3 Reporting Relationship
5.3.1 The Provincial Administration will be the link between the national and the district level.
5.3.2 At district level, the Council and the Government representative will report to the
Provincial Administration.
5.3.3 The sub-District Level will report to Councils.
6.1 For the decentralisation process to be successful and on a sustainable basis, there will be
need for adequate funding. The Government is committed to fund the implementation of
the decentralisation process.
6.2 The Government will also raise resources from the following:
(a) Cooperating partners;
(b) Contributions through Community participation;
(c) Private investment in local development projects; and
(d) NGOs participating in local development projects and service delivery.


Final report
in Zambia
A comparative
analysis of strategies
and barriers to
Nava Ashraf
Oriana Bandiera
Florian Blum
November 2016
When citing this paper, please
use the title and the following
reference number:
Decentralisation in Zambia:
A Comparative Analysis of Strategies and Barriers to
Florian Blum
Oriana Bandiera and Nava Ashraf
November 2016
1. Introduction ………………………………………………………………………………………………………..1
1.1. Focus Country Summary………………………………………………………………………………….3
1.2. Decentralisation Reform Overview …………………………………………………………………..4
2. Analytical Approach …………………………………………………………………………………………….7
3. Administrative Decentralisation ……………………………………………………………………………7
3.1. Risks in Devolving Policy Making Power…………………………………………………………….8
3.2. Risks in Devolving HR Management………………………………………………………………….9
3.3. Overcoming Limited Administrative Autonomy………………………………………………….9
3.4. Achieving Local Accountability after Administrative Decentralization …………………12
4. Fiscal Decentralisation………………………………………………………………………………………..13
4.1. Risks in Assigning Meaningful Expenditure Autonomy ………………………………………14
4.2. Risks in Local Revenue Collection……………………………………………………………………14
4.3. Designing Transfer Systems……………………………………………………………………………15
4.3.1. Transfer Systems in Focus Countries ………………………………………………………..17
4.3.2. Practical Challenges with Transfer Systems……………………………………………….17
4.4. Achieving Local Accountability after Fiscal Decentralization ………………………………18
5. Conclusion…………………………………………………………………………………………………………19
6. Bibliography………………………………………………………………………………………………………20
7. Annex: Focus Country Comparison Based on the 10 Areas of the Zambian
Decentralisation Implementation Plan …………………………………………………………………………25
List of Tables
Table 1: Focus Country Overview…………………………………………………………………………………..3
List of Figures
Figure 1: Ranking of Decentralization Reforms………………………………………………………………..4
1. Introduction
Decentralisation reforms have been at the centre of the public policy agenda for multiple
decades. International institutions such as the World Bank embrace it as one of the major
governance reforms on their agenda. In addition, policymakers and researchers alike consider
decentralisation in China and India to be a determinant of their recent economic success
stories (Bardhan, 2002). The classical case in favour of decentralisation highlights the benefits
achieved through increased flexibility under localised decision-making while cautioning that
local decision makers might fail to internalize the externalities created through their decisions.
This notion, first formalized by Oates (1972), hence highlights that decentralisation is
beneficial when tastes are heterogeneous and there are no spillovers across jurisdictions.
In more recent theoretical work, this view has been extended to also incorporate transaction
and agency costs. Seabright (1996) argues that local governments have an informational
advantage over central governments as it is less costly for them to acquire information on
preferences and production costs. In addition, local governments might have stronger
incentives to make use of their superior information as they are more accountable to local
recipients of public services. Besley and Case (1995) suggest that increased accountability can
arise due to competition between local jurisdictions, because people can vote with their feet
and through yardstick competition.
Some caveats to this analysis exist. On the one hand, Bardhan and Mookherjee (2000) point
out that increased accountability of local decision-makers can backfire, as they might be more
prone to local elite capture. On the other hand, competition between local jurisdictions is
constrained by the presence of high moving costs and local specialisations in public good
Two additional key determinants of the success of decentralisation reforms exist. On the one
hand, as pointed out by Bardhan and Mookherjee (2000), the extent of fiscal autonomy given
to local governments determines the extent to which decentralisation reforms are prone to
elite capture. When local governments don’t only have power to determine expenditure
patterns but are also given tax collection power, the risk of elite capture is high. This is because
the ability to raise tax revenue not only allows captured decision-makers to redistribute funds
from all citizens to the capturing elites, but may also allow local elites to evade taxes such as
local property taxes. A reliance on user fees can reduce the extent of cross subsidization as
only public service recipients can be asked to contribute to the cost of the service. Yet, user
fees are often not feasible, for example when asking the recipients of the service to contribute
to its cost would defeat the purpose of the program. This could be the case for anti-poverty
programs aimed at redistributing income from rich to poor households, for example. An
alternative that also reduces the risk of elite capture is a reliance on grants from the central
government, which disconnects expenditure devolution from decentralisation in revenue
collection. While central government financing requires little administrative capacity at the
local level it also generates weak incentives for cost savings. When trying to maximize
production efficiency as part of a decentralisation reform, policymakers hence face a tradeoff
between cost-minimization and the risk of elite capture.
The second key determinant of decentralisation success is the ability of local governments to
handle the assigned tasks. As has been pointed out by Bardhan (2002), disparities in technical
and administrative capacity between the central and the local governments are the main
cause of unsuccessful decentralisation reforms. The challenge with decentralisation reforms
is hence that central governments don’t know what to do and local governments don’t know
how to do it.
Given those countervailing theoretical arguments, the Zambian government has requested an
empirical investigation that evaluates the risks and opportunities associated with
decentralization. This paper reviews the literature on decentralization reforms in four SubSaharan
African countries (Tanzania, South Africa, Sierra Leone and Ethiopia) to understand
which factors can contribute to a successful decentralisation reform and how the design of
reforms affects their impact.
The four countries that this review focusses on were chosen because their context is
comparable to Zambia and they have experienced comprehensive decentralization reforms
which produced mixed results which maximises learning opportunities for Zambia. Today, all
countries have a de-jure system in which the administrative responsibility for health,
education and infrastructure has been devolved to local government’s authorities (LGAs). In
addition, LGAs in all focus countries have (limited) revenue raising and expenditure power.
1.1. Focus Country Summary
Table 1 provides summary information about the focus countries. In order to assess the
comparability of the focus countries to the Zambian context, it also benchmarks the
information to Zambia. The table puts a particular emphasis on the political structure of the
countries, as the literature considers this to be a major determinant of successful
decentralisation reforms.
The indicators highlight the dimensions that determine successful decentralization in which
the focus countries are comparable to Zambia. In particular, we focus on three dimensions:
Aggregate economic activity, the political system, and trade. First, in terms of aggregate
economic activity, column 2 in table 1 highlights that Zambia is comparable to Tanzania,
Ethiopia and Sierra Leone, whereas South Africa has a substantially higher GDP per capita.
South Africa also employs a higher fraction of GDP as government expenditure than the other
focus countries and Zambia. Column 3 shows that including South Africa is still important to
understand the Zambian context, as its democratic system is most comparable to Zambia. In
addition, column 4 highlights that, as opposed to Tanzania and Ethiopia, Sierra Leone, Zambia
and South Africa are all export based economies. As such, depending on the dimension of
interest, all focus countries provide relevant comparisons to Zambia.
Table 1: Focus Country Overview
Country GDP per
capita in PPP
US$ (2015)
Index (scale
from 1 to 10,
US: 8.11)
by single
trade (% of
(% of GDP2015)
Tanzania 2,667 5.77 Partially 35 19
Ethiopia 1,626 3.72 Yes 37 20
Sierra Leone 1,591 4.56 No 49 20
South Africa 13,165 7.82 Yes 60 34
Zambia 3,853 6.39 No 73 26
Sources: GDP per capita and trade figures-World Bank World Development Indicators; Government expenditure figures – International
Monetary Fund; Democracy Index – Economist Intelligence Unit
1.2. Decentralisation Reform Overview
In all four countries decentralization reforms shared three characteristics. First, similar to the
Zambian decentralisation plans, reforms in the focus countries involved the devolution of
basic service delivery powers to local governments. Second, in all cases the central
government retains authority over policy and standard setting in order to assure a minimum
quality level of public service delivery. Finally, while all focus countries allocate some revenue
collection power to local governments, financing of LGA activities primarily occurs through
central government grants.
Decentralisation reforms in the focus countries had various levels of effectiveness. Figure 1
presents a proposed ranking, with darker colours indicating more successful decentralization
Figure 1: Ranking of Decentralization Reforms
Tanzania had the least effective experience. LGAs in Tanzania were established in 1982 and
have since then sequentially received increasing administrative power. The current local
government framework has been in place since 1996 and was comprehensively reformed in
1999. As part of this reform LGAs were assigned responsibility over basic service delivery
functions such as primary health and education, agricultural extension, local water supply and
road construction. Local government staffing and planning is still primarily controlled by the
central government, which is also the main provider of LGAs’ funds. Tanzania’s
decentralization efforts are widely considered to have been ineffective at best, and
destructive at worst. As the major decentralization reforms weren’t driven by a political will
to decentralize, but can be partially considered a response to external (donor) demand, its
ability to succeed was limited from the start. The main shortcoming of the Tanzanian
Tanzania Sierra
Africa Ethiopia
decentralization efforts is that the decentralization was never fully executed and instead
created breaks in the chain of command that now significantly limit service delivery. Local
governments rely on central government funding, capacity and structures to deliver public
services, yet there are no formal mechanisms that allows central government ministries and
local government agencies to cooperate (Fermet-Quinet et. al., 2008; Venugopal and Yilmaz,
In contrast to Tanzania, Sierra Leone embarked on a self-initiated decentralisation reform
after the end of the civil war in 2002 as a newly instated Truth and Reconciliation Commission
called for more locally inclusive policies. The main motivations for the decentralization reform
were to reconfigure political institutions to reduce risk of further sources of conflict and to
enhance government legitimacy and increase political support by taking power away from
local chieftains and strengthening LGAs. As part of this reform, Sierra Leone recreated the
institutions of local councils and formalised traditional chieftains, both of which had been
abolished in 1972. The government then proceeded to devolve administrative power over
primary and mid-secondary education, primary and secondary health facilities, roads,
agriculture, water and social welfare functions to the local institutions. This highlights a key
positive aspect of decentralization: In ethnically fractionalized states, such as Sierra Leone,
decentralization can work towards overcoming ethnic tensions as it provides autonomy to
communities that avoids sources of friction.
LGAs are primarily financed through a system of inter-governmental transfers.
Decentralization has, however, been slower then expected, with especially the
decentralisation of road construction still facing significant political constraints due to an
unwillingness of the central government to limit its authority. Given those constraints, the
evaluation of Sierra Leone’s decentralisation efforts is generally mixed. In particular, existing
evidence finds no effect of decentralisation on health care coverage and education indicators.
In addition, staff attendance in health and education facilities has decreased postdecentralisation,
possibly due to a lack of capacity to monitor attendance in the LGAs
(Edwards, Yilmaz & Boex, 2015; Srivastava and Larizza, 2011).
Decentralization in South Africa was initiated as a response to challenges after the end of
Apartheid and was needed to reincorporate the former homelands (‘bantustans’) in the
country. Decentralisation was finalised as part of the post-Apartheid constitution, passed in
1996, which allocated social service provision powers to LGAs while allowing the central
government to assist through coordination and policy making. A particular characteristic of
the South African decentralisation process is that it devolved decision making power to two
different sub-national layers of government. On the one hand, provincial governments are
responsible for the administration of major social services such as education and health.
Districts councils, on the other hand, organise infrastructure related service provision, such as
water, sewerage and electricity provision. While there is some evidence that the devolution
of power in South Africa has improved the targeting of HIV treatment expenditure to areas
most affected, strong influence from the ruling African National Congress limits de-facto local
autonomy and therefore LGAs’ ability to tailor public services to local needs (Wittenberg,
Finally, the literature widely considers the Ethiopian decentralisation attempt a successful
reform (e.g. Halvorsen, Smith and Shenkut, 2005). Decentralisation in Ethiopia started after
the end of socialist rule in 1991. The process was primarily driven by the Ethiopian People’s
Revolutionary Democratic Front1 which aimed to reverse previous policies of homogenisation,
in order to assuage regions and ethnic groups demanding increased control and participation
(Cohen, 1995; Turton, 2006). The reform was completed in 1995 with the passing of a new
constitution that recognized the local right to self-determination and created a federal
structure. As part of the constitutional reform, LGAs were given full responsibility over basic
service delivery functions, including primary education, agriculture, health, water, sanitation,
roads. Similar to the reforms in the other focus countries the federal government retains
authority over setting policies and standards in the devolved administrative areas. Given
positive experience with the constitutional reform, decentralisation was extended in 2002
when a subset of decision powers was devolved further from regional states to local level
districts (“Woredas”). Local service delivery is primarily funded through (ear-marked) block
grants from the central government. Evaluations of Ethiopia’s decentralisation experience

1 The EPRDF is the ruling party in Ethiopia that was formed out of a coalition of militias that overthrew the
military junta in 1991.
point to decentralisation having improved the performance of the public sector, both through
increased efficiency in the use of resources and enhancing the outreach of public service
delivery. 2 As an explanation for this success the literature primarily points towards the
existence of strong party ties between local and central government officials that facilitate the
flow of information and generate strong incentives for local officials to enhance service
delivery (e.g. Khan et. al., 2014b).
2. Analytical Approach
The structure of this literature review is based on the methodology developed in Yilmaz, Beris
and Serrano-Berthet (2008). The main premise of this framework is that successful
decentralisation can only be achieved if it sustainably implements and enforces local
discretion and local accountability. The idea behind this premise is that local governments
need the autonomy, means and incentives to respond to citizens’ demands. At the same time,
citizens require the ability and opportunity to demand accountability from their LGA
representatives. We apply this framework to the focus countries in order to identify the
characteristics of decentralisation reforms that determine their success. We perform the
analysis of the literature separately for administrative and fiscal decentralization, focussing
first on the determinants of administrative autonomy and accountability before turning to
fiscal autonomy and accountability.
3. Administrative Decentralisation
The framework developed by Yilmaz, Beris and Serrano-Berthet (2008) identifies a number of
factors that determine the extent to which LGAs have de-facto autonomy over administrative
issues. This section will focus on a subset of two factors: First, local governments need to have
the de-jure and de-factor power to design and implement local policies. Second, the central
government needs to devolve HR management functions to LGAs. The following section will
discuss challenges with administrative autonomy separately for those two areas.

For example, a $1-dollar increase in decentralised expenditure is associated with a 3.7% increase in
educational enrolment rates (Khan et. al. 2014a).
3.1. Risks in Devolving Policy Making Power
Challenges with decentralisation reforms can be traced back to shortcomings in the allocation
of autonomy to LGAs to design and implement local policies. In general, the design of
decentralization reforms in focus countries either formally or informally restricts local
government autonomy, therefore limiting LGAs’ ability to use superior information to target
public expenditure and public service provision. In Sierra Leone, for example, devolution of
policy making power is undermined by a “divide and rule” strategy employed by the central
government to keep local councils weaker than they could be. This strategy allows the central
government to control LGAs by playing off traditional authorities (“chieftaincies”) against local
authorities. The resulting vacuum of power is facilitated through the design of the
decentralisation reform, which remained vague about the formal division of power between
LGAs and chieftaincies. This ambiguity is supported through a 2010 amendment of the
decentralisation reform in which the national government established a “district officer”
position at the local level that provides a direct link between national government and
chieftains, therefore bypassing LGAs and undermining the power of local councils (Srivastava
and Larizza, 2011).
A similar situation has been documented for South Africa, where competencies are more
dispersed at the local level. In particular, responsibilities are spread over three layers of local
government: provincial governments are responsible for the administration of major social
services (especially education and health), whereas infrastructure services are administered
by district level councils. Overlapping competencies create policy uncertainty that reduces
local autonomy. In addition, district councils have passed service delivery functions on to local
councils but maintain the responsibility for their financing. This division was initially born out
of the necessity to address administrative capacity gaps at the local council level but has
persisted even after the capacity had been built and now creates unnecessarily long chain of
commands (Wittenberg, 2003).
While local administrative autonomy is limited through mostly informal channels for Sierra
Leone and South Africa, a number of authors suggest that the major risk to decentralization
in Ethiopia originates in the formal channels developed by the central government (Yilmaz and
Venugopal, 2011). In particular, strong central party influence significantly restricts local
autonomy, as local government officials are incentivized by and accountable to the (central)
party administration. The performance of local level development agents, for example, is
primarily measured through the achievement of planning targets set centrally by the party
(Dom and Mussa, 2006). Taken together, this experience therefore suggests that
understanding the motivations of central government decision makers, and making sure that
central stakeholders are committed to devolving power to the local level, is crucial.
3.2. Risks in Devolving HR Management
Similar to the devolution of power to design and implement local policies, the decentralisation
of staffing decisions is also limited in the focus countries. In Tanzania, for example, all district
level operations are overseen and managed by the District Executive Director (“DED”) who is
appointed by the central government. The DED can himself appoint the executives of lower
level LGAs, leaving no space for local decision making in appointing executives. This pattern
of central influence also exists for non-executive positions. Tanzania’s LGA staffing decisions
are made by local employment boards, which have 3 members from the central and 2
members from the local governments, therefore limiting local staffing autonomy. Similarly,
doctors, secondary school teachers, accountants, nurses and agricultural extension officers
are typically recruited by the responsible central ministry and then deployed to LGAs
(Venugopal and Yilmaz, 2010).
A similar situation exists in Ethiopia, where all local hiring and firing decisions require approval
from higher levels of government. For example, regional bureaucrats need to approve hiring
decisions for teachers and zonal as well as regional executives have the ability to overrule
woreda level hiring decisions. Similarly, the EPRDF retains a decisive role in the appointment
of high-level executives at the local levels (Yilmaz and Venugopal, 2011).
3.3. Overcoming Limited Administrative Autonomy
A possible explanation for de-facto low levels of administrative autonomy is the prevalence of
capacity constraints at the local level. Experience from the focus countries shows that
especially skills necessary for budget execution, such as planning and accounting skills, as well
as financial and HR management skills, are in short supply at the local level. For example, an
assessment of LGA performance in Tanzania shows that only 8.6% of councils have high
financial management capabilities, with most rural councils receiving the lowest possible
rating (World Bank, 2001). A more recent assessment reveals that while the situation has
improved for some LGA’s, particularly those close to urban areas and the capital city,
inadequacies of key professional staff with some of the above skills, such as accountants,
continue to persist, particularly in rural councils (Parliamentary Centre, 2011).
In addition, LGAs are constrained by insufficient management skills. For the case of South
Africa, limited staffing ability of local governments especially for elected positions led to
inadequate staff establishments (Koelble & Siddle, 2012). This did not only result in a high rate
of vacancies in local governments but also led LGAs to install non-elected bureaucrats in
leading (political) LGA position, therefore undermining local accountability (Wittenberg,
2003). Similarly, Sierra Leone has experimented with decentralized recruitment of staff but
has resumed central recruitment after it was found that the skill sets of the newly recruited
staff were far below those of (local) staff assigned by the (central) Office of the Establishment
Secretary (Kanu, 2009).
Countries have experimented with multiple ways of overcoming human capacity constraints.
First, development partners in Tanzania provided computerised systems for accounting,
planning, M&E and budget reporting as part of the decentralization reform. Donors also
supported the hiring of technical advisors who are tasked with supplementing a lack of
administrative capacity at the local government level. While there exists no evaluation for this
program, anecdotal evidence suggests that while this program was effective in providing the
necessary infrastructure for decentralization, it did not allow LGAs to satisfactorily fulfil their
duties in the long run (Frumence et. al., 2013).
A second capacity building measure regularly employed by central governments involves the
provision of training to local government staff. This is either organized through capacity
building grants allocated to LGAs or through standardized countrywide training provisions.
The evidence on such programs is generally positive. Tanzania has so far invested a total of 6
billion Tanzanian Shillings (approx. 3 million USD) in capacity building grants, mostly targeted
at improving planning and financial management skills. The literature perceives this program
to have been successful in improving the level and targeting of service delivery (REPOA, 2008).
Similarly, the Ethiopian central government maintains training programs for elected LGA
officials that focus on agricultural development, basic management, financial management,
integrated rural development and ethics and are generally reviewed positively (Beyene, 2000).
The South African government undertook a special capacity building measure to train LGA
staff on effective public service provision. As part of this program, LGAs cooperated with
private companies tasked with training LGA personnel in the area of water management. This
measure has been evaluated very positively as it generated local government capacity and
also supported emerging companies in the area of water management (Elhiraika, 2007).
Finally, all focus countries have also experimented with transferring experienced central
government staff to LGAs in order to fill capacity gaps. While this is generally viewed as an
effective measure to overcome human capital constraints, central government staff is
typically unfamiliar with local conditions. This program therefore reduces LGAs’ ability to
target its services to local demand conditions.
While capacity building attempts are generally viewed favourably in the literature, two major
challenges have arisen. First, when wages for LGA staff are fixed between locations, qualified
staff tends to sort into urban or more developed areas, leading to disadvantages for poorer
regions. It is hence key to devolve de facto autonomy over staff compensation to local
councils, and assure that financing for compensation is readily available (see also section on
financial decentralization below). Second, LGAs don’t only compete with each other but also
with the private sector, given that especially budget execution skills are also crucial for the
success of businesses. As such, attrition, especially after capacity building programs have been
completed, is a major concern (Girishankar et. al., 2006). The economic literature highlights a
number of ways that retention of government workers can be assured. First, increased
compensation and performance pay can foster retention (e.g. Deserranno, 2016; Dal Bo et. al.
2013). In addition, opportunities for career development, continuing education, , resource
availability and recognition/appreciation have been shown to reduce health worker attrition
in various developing country contexts (see the literature review by Willis-Shattuck et. al.,
3.4. Achieving Local Accountability after Administrative
When considering the determinants of local accountability, Yilmaz, Beris and Serrano-Berthet
(2008) separate public and social accountability. In their terminology, public accountability
refers to the accountability of leading administrators at the local level to their top
administrative officers or auditors. Social accountability, on the other hand, refers to
community-based auditing of the quality of service provision.
Focus countries’ experiences with public accountability are mixed. On the one hand, high
levels of public accountability are a possible explanation for the positive performance of South
Africa’s and Ethiopia’s decentralization reform. To overcome communication challenges, the
South African central government has established sector specific intergovernmental relations
committees of ministers and members of provincial councils. While such committees are only
consultative with limited executive powers, they can still provide incentives for service
providers to increase accountability and enhance information flows (Eaton, Kaiser and Smoke,
2010). Similarly, public accountability in Ethiopia is driven by strong incentives provided by
the centralised party structure that makes career progression of civil-servants dependent on
service delivery outcomes (World Bank, 2005; Yilmaz and Venugopal, 2011).
While accountability in Ethiopia works for service providers, it works significantly less for local
councillors tasked with overseeing executive policy implementation and service delivery. As
they are partially accountable to higher level (party) bureaucracies and partially to local
electorates, the aforementioned incentive channel is weakened, therefore undermining
public accountability (Khan et. al., 2014a). A similar picture emerges for Tanzania where all of
the executive staff is centrally appointed but monitored by local level councils. As local
councils have no instruments to discipline centrally appointed staff and there are no formal
linkages that allow the central government to effectively monitor local level executives, an
agency problem arises. This set-up therefore generates weak incentives for service providers
which undermines the effectiveness of decentralisation reforms (Venugopal and Yilmaz,
Achieving social accountability has proven to be significantly more difficult than achieving
public accountability in the focus countries as there is little evidence of local citizens
effectively sanctioning poorly performing local government officials. In Tanzania, for example,
the standard method to assure social accountability is through village assembly meetings.
While this assembly has the de-facto authority to overrule village leaders’ decisions,
Venugopal and Yilmaz (2010) report that there are no examples of such behaviour. At the
same time, village assemblies are not equipped with the authority to sanction local council
members, therefore limiting opportunities for social accountability.
A success story supporting the effectiveness of social accountability mechanisms comes from
Ethiopia, where structured feedback sessions that brought together citizens and service
providers significantly strengthened citizen participation and improved service delivery
outcomes. Similarly, grievance redress mechanisms through a designated ombudsman,
formalised citizen feedback mechanisms and joint service improvement plans led to
improvements in basic service provision (Khan et. al., 2014b). However, Ethiopia’s strong party
leadership, one of the drivers of successful public accountability, also undermines more
traditional social accountability channels. Traditionally, village level assembly (“kebele”)
meetings used to be the first point of contact for citizens to provide feedback about service
provision. In the recent past, it has however been argued that kebeles have come to be
primarily controlled by party cadres, and are hence unable to act as a platform that supports
social accountability (Pausewang et. al., 2002; Human Rights Watch, 2010).
4. Fiscal Decentralisation
The framework developed by Yilmaz, Beris and Serrano-Berthet (2008) identifies three factors
that determine the extent to which LGAs have de-facto autonomy over fiscal issues. First, LGAs
require a meaningful level of expenditure responsibility. For LGAs to be able to respond to
local needs, it is crucial that they retain discretion to make their own expenditure allocation
decisions. Second, LGAs need to have the autonomy and capacity to collect their own revenue.
LGAs should have rate-setting authority over locally assigned revenues and should be allowed
to define their own tax base. This argument is associated with the notion that local
governments are more accountable when relying on their own tax bases (Faguet, 2008).
Finally, LGAs need to receive financing assistance through transfers. This is because own-tax
revenue typically isn’t sufficient to cover LGAs expenditure requirements. To bridge this gap,
local authorities rely on transfers from the central government. Maintaining autonomy and
accountability in the design of this transfer system has proven to be a major challenge in focus
4.1. Risks in Assigning Meaningful Expenditure Autonomy
Expenditure autonomy is typically limited by central regulation. In particular, experiences
from the focus countries show that the de-facto expenditure autonomy allocated to local
governments differs substantially from the de-jure status. In Tanzania, for example, while
LGAs have de-jure autonomy over expenditure allocation, 78.5% of local government
spending is recurrent, mostly due to high staff costs, leave little space for decentralised
expenditure targeting.
Expenditure autonomy is mostly undermined through the employed financing mechanisms
and, among those, primarily through the reliance of LGAs on central government transfers.
With the aim of increasing effectiveness, such transfers are typically earmarked or are
associated with prescribed sector-specific maximum spending. In Tanzania, for example, LGAs
have the de-jure autonomy to determine the wage structure for their employees
independently. Yet, spending limits on wages, together with a transfer allocation that is
dependent on the number of LGA employees, typically prescribes a specific level set by the
central government (World Bank, 2001).
A similar picture emerges for the case of South Africa, where LGAs are responsible for
financing the salary of staff at the local level through unconditional grants received from the
central government. While this set-up allocates a high de-jure autonomy to local
governments, central regulation de-facto limits local discretion by describing salary levels for
local staff and making transfer allocation conditional on the expected wage bill, leaving little
space for discretionary budget allocation (Wittenberg, 2003).
4.2. Risks in Local Revenue Collection
The framework developed by Yilmaz, Beris and Serrano-Berthet (2008) suggests that the
ability of local level governments to finance their operations through own revenue sources is
a crucial determinant of LGA autonomy. Experience from focus countries does, however,
reveal three challenges with local revenue collection.
First, levels of locally collected revenue are generally low. For example, while Sierra Leone’s
LGAs finance 25% to 30% of their total expenditure through self-collected revenue, Tanzanian
LGAs only achieve a mere 6.9% (USAID, 2010; Searle, 2009). This is driven by the fact that in
the absence of transfers only narrow tax bases can be put under the control of local
governments as the taxation of large tax bases, such as corporate profit, generates spillovers
between LGAs that aren’t internalized under a decentralized system. In addition, devolution
of income and corporate tax bases significantly exacerbate the inequality between urban and
rural LGAs. Given those constraints, only narrow tax bases, such as property value, are
typically delegated to local governments. Those bases, however, are too narrow to finance
the recurrent expenditure of especially rural LGAs (Oates, 1972).
Second, local revenue collection can exacerbate political tension and undermine social
accountability. On the one hand, even the devolution of narrow tax bases, such as property
value, is likely to generate significant inequality in tax collection rates between urban and rural
areas and hence supports differential service provision levels in the absence of transfers. On
the other hand, local revenue collection makes LGAs prone to elite capture. In Sierra Leone,
for example, anecdotal evidence suggests that the devolution of property tax collection power
significantly increased pressure from (property owning) local elites to reduce tax collection
efforts, therefore undermining local fiscal capacity (Jibao and Prichard, 2013).
Third, fiscal capacity is not only undermined by local elites but also through the incentives
created by fiscal transfer mechanisms. In Ethiopia, for example, Woredas receive targets for
tax collection but are responsible to transfer any excess tax collected back to the regional
level. As this arrangement significantly reduces Woredas’ benefits from tax collection, it
generates limited incentives to create tax collection capacity at the local level (Adal et. al.,
4.3. Designing Transfer Systems
Establishing a fiscal transfer system to finance LGA expenditure is a central part of any
decentralisation reform. On the one hand, transfers are suitable mechanisms to redistribute
income between rich (urban) and poor (rural) areas in order to equalize levels of public service
provision (e.g. Bordignon, Manasse and Tabellini, 2001). Transfers can also be used to
internalize inter-regional spillovers. For example, LGAs might be more likely to invest in
infrastructure that also benefits other regions (for example building power plants that serve
multiple regions) if inter-regional transfers assure that they are compensated for the resulting
benefits. Finally, transfers can also act as an insurance against local economic shocks, for
example allowing LGAs to raise government expenditure in response to high local
unemployment (e.g. Lockwood, 1999).
Designing intergovernmental transfer systems is, however, significantly constrained by interregional
heterogeneity and information asymmetries between the central and local
government (Bordignon, Manasse and Tabellini, 2001). For example, there might be spatially
diverging preferences for different public goods (Cremer et. al., 1996). Alternatively, localized
access to technologies used for the production of public goods can lead to differences in cost
structures (Cornes and Silva, 2000). When those differences aren’t directly observable by the
central government they can lead regions with lower costs for public good production to
receive higher transfers than they require, leaving high cost regions short of funding. Similarly,
central government transfers can also weaken LGAs’ incentive structure, for example by
reducing effort exerted on local revenue collection.
When designing transfer systems, policy makers therefore need to assure that they maintain
local incentives for revenue collection and efficient public good production while also basing
transfer allocations on indicators that are proportional to preferences for public goods and
cost measures. One example used in the literature for such an indicator is the income or
property tax rate chosen by the local government: Higher tax rates are costly but imply a
higher valuation for tax revenue which is used to signal a region with higher demand for public
goods or higher costs. Regions with higher tax rates should therefore be rewarded with higher
transfers (Bordignon, Manasse and Tabellini, 2001).
In reality, best practice suggests using one of two possible options to design transfer systems.
On the one hand, the amount of transfers can be based on a “normative” measure of the costs
associated with public service delivery. Examples that have been used include local population
size and estimates of the costs associated with public good production. This option is primarily
used by developed countries where reliable accounting data is available. For example, most
OECD countries use fixed distribution formulas that reflect the average or normative cost of
the basic package of public services provided by LGAs. It is, however, unclear to what extent
such measures can be obtained in a developing country context (Bergvall et. al., 2006).
On the other hand, transfer amounts can be based on measures of tax collection effort. Recent
developing country experience suggests that tying transfer formulas to revenue generation
can serve as a motivator for subnational governments to embark on wealth enhancing
policies. The challenge is to identify measures of tax collection effort that are independent of
local conditionsto not further exacerbate inequality between rural and urban areas. Potential
measures include effective tax rates and tax collection relative to an independent assessment
of the tax base size (Poeschl and Weingast, 2013).
4.3.1. Transfer Systems in Focus Countries
Transfer systems in the focus countries typically take one of two possible shapes. On the one
hand, they can be indicator-based, meaning that the size of central government transfers is
determined by LGA-specific characteristics, such as the local development indices or poverty
and literacy rates. A key challenge with this approach is that fund allocation is unrelated to
costs. Similarly, indicator-based approaches are typically biased towards relatively large and
poor LGAs. Taken together, an indicator-based approach typically leaves richer LGAs with high
costs short of financing. In addition, this approach requires regularly updated information on
development indicators collected at the local government level, which is costly in itself.
An alternative to the indicator-based approach used in the focus countries is a cost-based
approach to transfer allocation, which determines transfer size as a function of LGA
administration costs. While the cost based-approach is certain to recover LGA expenditure,
experience from Sub-Saharan African countries shows that it can lead to blowing up of staff,
or breaking down of LGA units to increase transfer allocation (Smoke, 2003 and 2008).
4.3.2. Practical Challenges with Transfer Systems
Experience from the focus countries shows that the disparity between rich (urban) and poor
(rural) LGAs is a key challenge to effective transfer systems design. In South Africa, for
example, LGAs’ share of transfer income spans from 15% in urban areas to 80% in more rural
LGAs. Urban municipalities are therefore able to achieve the same level of service delivery as
rural regions while maintaining a higher independence from the central government, which
creates significant spatial heterogeneity in local autonomy and the effectiveness of
decentralisation reforms (Koelble & Siddle, 2012).
A second challenge that has arisen in focus countries relates to the timeliness and reliability
of transfer payments. In Sierra Leone, for example, the central government demands detailed
documentation and justifications of previous expenditure before approving additional
payments. As the assessment of such reports is time consuming, this system causes
substantial uncertainty, which has shown to particularly delay infrastructure investments
(Edwards, Yilmaz and Boex, 2015).
Finally, the central government in South Africa regularly engages in large discretionary
investments in areas allocated to local governments, such as road construction. As
coordination between LGAs and the central government is insufficient, such investments
regularly conflict with LGA budgeting, therefore not only reducing local government
autonomy but also leading to inefficient resource allocation (Wittenberg, 2003).
4.4. Achieving Local Accountability after Fiscal Decentralization
Similar to administrative decentralisation, Yilmaz, Beris and Serrano-Berthet (2008) separate
public and social accountability when considering the determinants of local accountability in
the fiscal sphere. In their terminology, public accountability refers to the implementation of
effective, transparent and rule based public financial management. Social accountability, on
the other hand, refers to community-based monitoring of financial management, for example
through legislators, the civil society or the general public.
While focus countries have actively attempted to improve public accountability, those efforts
have been met with a number of challenges. On the one hand, implementing consistent
budgeting procedures and public financial management structures requires human capacity
at the local level. Experience from the focus countries shows that especially skills necessary
for budget execution, such as planning and accounting skills, as well as financial management,
are typically in short supply in local government authorities. In addition, reports on Ethiopia
and Tanzania suggest that there is a lack of capacity to monitor local expenditure. As a result
of such human capacity constraints, LGAs require assistance by experts from higher levels of
governments, therefore undermining local autonomy and reducing the effectiveness of
decentralisation reforms. On the other hand, evidence from Ethiopia suggests that elected
representatives tend to have lower levels of literacy rates compared to full time civils servants.
This significantly constraints their ability to oversee the planning, budgeting and service
delivery process and therefore reduces public accountability (Yilmaz and Venugopal, 2009).
Social accountability faces a similar challenge, as it is unclear whether legislators, the civil
society and the general public have access to the necessary information to scrutinize public
financial management. Evidence from Tanzania suggests that citizens are typically uninformed
about the decision power available to LGAs, let alone their performance (World Bank, 2010).
Similarly, recent survey evidence from Ethiopia shows that 91% of respondents are unaware
of the extent of financial autonomy allocated to their local government. A similar fraction was
unaware of how local expenditure was allocated (FTAPS, 2009). Taken together, this evidence
suggests that local social accountability is significantly constrained by information
asymmetries, hinting to the importance of LGA transparency during and after the
decentralisation process.
5. Conclusion
Decentralisation reforms are typically used as a policy instrument to improve the targeting of
public services and the accountability of public service providers, thereby enhancing the
effectiveness of public sector operations as a whole. This article has argued that there exists
substantial heterogeneity in the extent to which decentralisation reforms allocate de-facto
autonomy to local governments, driven primarily by the design of the reform process.
Evidence from South Africa, Tanzania, Ethiopia and Sierra Leone suggests that decentralisation
reforms maintain strong elements of central regulation and therefore remain incomplete.
Taken together, experience from the focus countries suggests that assuring a commitment to
delegating power at the central level and the availability of capacity to deliver services and
demand accountability at the local level is key for successful decentralisation.
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7. Annex: Focus Country Comparison Based on the 10 Areas of the Zambian
Decentralisation Implementation Plan
Tanzania South Africa Sierra Leone Ethiopia
Legal and
Local Government Reforms I
(1982): Reinstitution of LGAs with
mainly administrative
Local Government Reforms II
(2009): Increasing fiscal
Organized Local
Government Act (No.52,
1997): Reintroduction of
local authorities as part of
constitutional reform.
Local Government Act
(2004): Introduction of Local
Councils and devolution of
National Decentralization
Policy (2010): Revision of
legislature and standards.
District Level Decentralization
Program: Phase I (1991)
devolution of administrative
responsibility from national to
regional level; Phase II (2002)
further devolution from regional
to district level.
LGA Responsibility: Primary
education, primary and
preventive health, water supply,
sewerage and sanitation in rural
areas, solid waste, agricultural
LGA Responsibility:
Electricity, water supply,
sewerage and sanitation,
firefighting, municipal
health services, land use,
municipal infrastructure,
food markets, recreational
areas, local tourism
LGA Responsibility: Primary
and secondary education &
health care, rural water
supply, sanitation, waste
management, agriculture,
youth services, social
assistance, and local
LGA Responsibility:
School management, primary
and post-natal health care,
hospital/clinic administration,
primary schools, HIV/AIDS and
malaria prevention, water supply
Share of expenditure financed
through own revenue:
Fraction of conditional grants in
total financing:
Fraction of total transfers
Share of expenditure
financed through own
52.5% (rural), 86% (urban)
Fraction of conditional
grants in total financing:
Fraction of total transfers
Share of expenditure
financed through own
Fraction of conditional
grants in total financing:
Fraction of total transfers
Share of expenditure financed
through own revenue:
20-30 %
Fraction of conditional grants in
total financing:
Fraction of total transfers
and Civic
-Government cooperates with
Radio Free Africa to inform
people about decentralization
-DDTP lead by UNDP for
“Deepening Democracy”
-The Local Government
Negotiating Forum ran
Workshops and hosted
forums to educate and
garner support for the
1997 Decentralization
Two progammess led by civil
defense forces:
Disarmament, Reintegration
and Reconciliation (political
education and economic
integration) and Civic
Education (civing and human
rights education)
-Ruling party offers courses for
civic education
-“Promoting Basic Services
Program” implemented by the
CG to educate the public to
participate in local governance
Auditing and
-Monthly Internal performance
-External audits as support and
for donor-funded or development
– Annual
Intergovernmental Fiscal
Reviews (IGFR)
-Non-Central Monitoring
by Mayoral Executive
-Introduction of Audit Service
Sierra Leone (ASSL) in 1998
– Specialised agency to
conduct regular LGA audits
-Internal Audit and Investigations
Group (IAIG), run by UNOPS
-University Courses for LGA
-Donor and private company
– Central government grants for
capacity building conditional on
basic financial management and
transparency requirements
-Institutional capacity
building grant (7.5% of
unconditional grants) for
poor municipalities
-Human Capital
Programme by the ADB to
improve financial
management and service
-World Bank Institutional
Reform and Capacity Building
(IRCBP) Project
-Multi-Donor Budget Support
(MDBS) to assess
implementation of donorfunded
-National Capacity Building
Program (NCBP) targets a broad
range of 14 sectors
training programs for elected
district-level officials
and Governance
-Limited formal local
accountability measures
-Lack of Accountability due to
limited ability of community to
participate, primarily as a result of
information/transparency and
low education
-Approximately a third of
municipalities have formal
community participation
mechanisms, primarily
through community
-Lack of accountability by
centrally-deployed staff
-Local conflict between LGAs
and chiefdoms limits
-Regional targets overrule
community needs
– Strong central party influence
-Decision-making compromised
distribution system
Planning and
-Limited local developmentplanning
efforts due to central
government prescriptions and
partial intervention
-Local Development
Planning constrained by
discretionary central
-Establishment of
communications channel
through which local
communities can indicate
their needs to central
government (through
nonpartisan Financial and
Fiscal Commission (FFC))
-Innovation: New
budgeting framework that
allows multi-year
budgeting for LGAs.
-Councils have dedicated
positions for internal
auditors and m&e officers
-Sufficient staff to carry out
planning, budgeting, and
accounting available at the
local level
-Uncertainty over division of
responsibilities limits
development planning
-Limited room for discretionary
capital budgeting, as 91% is
earmarked for administrative
and operational expenditures
-Low capacity, which requires
(external or central government)
technical advisors to be hired as
the backbone of day-to-day
-Audit Reports indicate recent
improvements in financial
-Weak Financial
Management with 27
Billion Rand overexpenditure
on items
unrelated to service
-Missing formal taxation
by-laws in most
-Central government
requirement to receive LGA
expenditure report before
issuing new funds delays
public service delivery
-High Intransparency in
Financial Management due
to delays in publication of
accounting reports
-Limited information on
accounting procedures and the
reliability of provided
-Local Government Transport
Programme (LGTP) and Village
Travel and Transport Programme
(VTTP): Both require LGAs to
independently plan and tender
their transport development
-Municipal Infrastructure
Grant (MIG) for
development at the
municipal level
-Devolution of infrastructure
(especially road) planning
delayed due to political
-No identifiable local
initiatives for Infrastructure
development yet
-Telephone infrastructure
decisions are made by local
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Supporting the Zambian decentralisation process

Programme description

Title: Decentralisation for development (D4D II)
Commissioned by: German Federal Ministry for Economic Cooperation and Development (BMZ)
Country: Zambia
Lead executing agency: Ministry of Local Government and Housing (MLGH)
Overall term: 2015 to 2018

Zambia. Opening of a training measure for local authority financial management. © GIZ


With income distribution in Zambia remaining extremely inequitable, almost two thirds of the population live in poverty and are dependent for their survival on functioning municipal services. Nevertheless, the chance of noticeably improving people’s lives in Zambia through successful decentralisation of public services is better than ever before. Zambia enjoys steady economic growth and since the change of government in 2011 has demonstrated the firm political will to push ahead with devolution in the country. On behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ), GIZ has already supported the Zambian partner institutions during the last years to lay the foundation for the current devolution processes. By late 2014, the Zambian Government had made substantial administrative and legal preparations and paved the way for adopting concrete reform decisions on the further transfer of responsibilities to local governments.


The municipal administrations (district and muncipal councils) are better able to provide services for citizens. There are greater opportunities for participation by the population.

Zambia. Six handbooks on local authority management, developed by partner municipalities of GIZ, later introduced as the national standards and distributed countrywide. © GIZ


The programme is supporting the Zambian Government with the swift and gender-sensitive implementation of the reforms it has adopted in connection with the country’s decentralisation process.

The quality of municipal services is determined by a complex interplay of different levels of administration and departments. The programme is advising six councils in the Southern Province and two further councils in the Northwestern Province and the Copperbelt on performing their new steering and coordination functions. The programme’s national and international advisors and development workers are deployed at strategic control centres in partner organisations at local, provincial and national level. They advise on the application of new procedures and the clarification of anticipated practical issues in dialogue with the relevant Zambian agencies.

The programme closely coordinates its activities with other projects being implemented by GIZ in Zambia, in particular the water programme and the projects concerned with good financial governance and political participation. Since this is a joint programme with KfW Development Bank, the various measures are supported through financial cooperation.

The main issues addressed are:

  • Municipal finance and domestic financial structures
  • Municipal spatial and development planning
  • Strategic service management
  • Accountability between upstream and downstream authorities.

GFA Consulting Group is supporting implementation of project component A – municipal financial management and financial legislation.


Several predecessor programmes completed important preparatory work for the current measures. For example, strategy and planning papers geared to decentralisation were drawn up or revised. A new implementation plan was finalised in mid 2013, which set out the steps required to fulfil the National Decentralisation Policy.

Municipal budgets traditionally covered a period of one year and were planned around the procurement of goods needed. From 2009 onwards, medium-term fiscal planning and activity-based budgeting were introduced, starting with seven councils. In 2012 and 2013, this system was successfully rolled out across 66 councils. In late 2014, it was expanded to include the remainder of the 103 district councils. The quality of the budgets of the councils advised by GIZ has since been rated as above average by the central government.

Zambia. Elected members of a local council © GIZ

The councils are also being successfully advised on the cross-cutting issues of gender, HIV/AIDS and civil society / citizens‘ participation. Over half of the councils receiving advisory services have developed action plans on gender and HIV/AIDS. Furthermore, they used participatory planning and budgeting processes for the first time in preparing the 2015 budget.

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  1. editor
    editor Author January 15, 10:52

    TOURISM and Arts Minister Charles Romel Banda, a Broadcast Media Communication says two cases of cholera were speedily addressed through Public Health Specialists in Sinda District of the Eastern Province.
    Mr. Banda praised the District and Provincial Administration instituted measures discouraging people to be at the same place in groups of more than five community members within the two constituencies of Sinda.
    Formerly, a Zambia National Broadcasting Corporation (ZNBC), restated a need for citizens to adhere to community cleanliness tenets ascribed in 17 United Nations Development Agency (UNDP), through goal number eleven : “Make cities &human settlements inclusive, safe, resilient& sustainable”.
    Cue in Charles Banda on two cases of Cholera in Sinda
    Banda explained that the two noted Cholera cases were exported to the area by travellers from the line of rail, but the reported cases were mitigated by Eastern Province Permanent Secretary Chanda Kasolo.
    In addition, Banda, who is Kapoche Member of Parliament in Sinda District of the eastern Province, encouraged residents to keep surroundings clean as prevention of cholera was better than reliance on treatment.
    Cue in Banda on Cholera being imported into Sinda District

    Snail paced decentralization worries PNU
    By Derrick Sinjela

    FISCAL Decentralization is key to making Zambia an inclusive society, says Party of National Unity (PNU) Secretary General Kasote Singogo.
    While championing decentralized management of public affairs, Mr. Singogo says only defense and security must remain centralised.
    Singogo says a need to decentralize is imperative as communities at the grassroots level have peculiar needs, which cannot be determined by centralised government structures.
    “Zambia must decentralize as it is necessary to prioritize peculiar needs of the people,” Singogo told Radio Maria Yastani Voice Community Voice anchor Maybin Augustine Katungulu.
    Making a contribution, Bitwell Chisala, who served as Press Secretary to former First Republican President, Dr. Kenneth David Buchizya Kaunda preferred a presidential or federal system of governance.

    However, Singogo said centralised government structures were established by the British colonial leadership.
    The PNU Secretary General says political parties must facilitate provision of social amenities to people.
    Singogo says Government must not hold Gods people at ransom on account of s hospital, market or road.
    Singogo prefers people being encouraged to think and survive on their individual entrepreneurial skills.
    Singogo says once focal points in the development paradigm are decentralized, through people-cantered decision making, bureaucracy and red tape will be broken.
    Singogo says decentralization will facilitate communities holding people or controlling officers tasked with providing social services education and health accountable.
    Singogo says South Africa is decentralized to the extent that members in the African National Congress (ANC) as people are taken task on audit reports.
    Singogo says as Zambia moves closure to celebrating her 54th Independence Day on Wednesday 34th October 2018, it is imperative to place people at the centre of the decision making processes that determine choices.
    Quizzed on PNU faith on decentralization, Singogo said time had come for Zambia to let people determine their development preferences.
    The National Decentralization Policy-Towards Empowering the People, ” signed by Third Republican President, the late Dr. Levy Patrick Mwanawasa, hoped people-centrered aspirations would empower Zambians.
    While conceding that Natives Concept of the colonialists, Singogo recollected communities were not empowered to raise money locally and use it accordingly.
    Kasote Singogo proposed that the Constituency Development Fund and Presidential Empowerment Fund must be reorganized and disbursed through Citizens Economic Empowerment Commission (CEEC) Director General Likando Mukumbuta.
    “Empirical evidence shows that money is given on charitable basis, it does not graduate people into entrepreneurs. Allowing people to make use of their skills and intellect will facilitate communities and ordinary people to be innovative,” Singogo said.
    Singogo says lack of political will has resulted in PF cadres pocketing public money is impoverishing local authorities like Lusaka City Council (LCC).

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