Participatory Budgeting: Potential and Limitations Council of Europe “Participatory Budgeting in South East Europe” Kelmend Zajazi, NALAS Executive Director 10th May 2011, Palais de l'Europe, Strasbourg

OBJECTIVES Context in South East Europe NALAS Survey results on Participatory Budgeting General Observations Challenges 2

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Assumptions PB: representative democracy meets participatory democracy LG without citizen participation = de-concentrated arm of national government The failure to apply PB = failure of the local leaders, city administration & citizen activism

SEE Context: Local finances vs. PB Slow Fiscal Decentralization Financial crisis –> reduction of transfers –> affect participatory budgeting.. –> LG in “Survival Mode” + Local borrowing limitations (NALAS publication) + IPA funds centralized –> LG out of the “game” Capital investments managed by central gov. 5

SEE Context: Local finances vs. PB The other face of the coin: In the context of financial crisis, PB even more needed to fill the gap: - to mobilize additional community resources to build public good - citizen awareness / fiscal discipline, etc.. 6

NALAS Survey GENERAL CONCLUSION Legislation - prescribes principles of PB Challenge: effective implementation and mainstreaming. To do more than what’s prescribed in the law.. Methodologies at the local level are based on the legislation or developed in cooperation with donors/projects. PB exercises - experimental phase – exercising the process for a single decision not for the whole budget Ownership of methodologies and guidelines by Associations? 7

EFFORTS at ASSOCIATIONS’ LEVEL NALAS Survey EFFORTS at ASSOCIATIONS’ LEVEL Five (5) Associations reported projects / activities Mostly funded by donors - associations as co-implementers; Activities focused directly on PB are rare. PB treated within the general budgeting process; Typical activities: trainings, manuals, guides, articles in association bulletins; Two (2) associations dealt from the policy perspective: ALVRS - formal analysis of the legislative framework NAMRB includes PB as part of regular policy activities   8

EFFORTS at ASSOCIATIONS’ LEVEL NALAS Survey EFFORTS at ASSOCIATIONS’ LEVEL Five (5) Associations reported projects / activities Mostly funded by donors - associations as co-implementers; Activities focused directly on PB are rare. PB treated within the general budgeting process; Typical activities: trainings, manuals, guides, articles in association bulletins; Two (2) associations dealt from the policy perspective: ALVRS - formal analysis of the legislative framework NAMRB includes PB as part of regular policy activities 9

Good Practices at ASSOCIATIONS’ LEVEL NALAS Survey Good Practices at ASSOCIATIONS’ LEVEL “Community FORUMS” – ZELS “Sessions” stage – 6 to 8 meetings – project ideas “Implementation” stage Budget FORUM Co-financing by Municipality – NGOs implement 10

Good Practices at Local Gov. LEVEL NALAS Survey Good Practices at Local Gov. LEVEL Bulgaria Municipality of Troyan: finances projects initiated by citizens (renovation of green city areas) Municipality of Lovech: “public councils” in villages, residential areas, etc. 11

Good Practices at Local Gov. LEVEL NALAS Survey Good Practices at Local Gov. LEVEL Republic Srpska of the B&H City of Banja Luka: Public hearings. Published the draft budget in newspapers and its website. Public hearing report along with the budget proposal are submitted to the City Council. As a result budget approval by the City Council became straightforward. Slovenia Practiced by all LGs in several steps: - draft budget published on website and bulletin board - comments “Community working groups” collect inputs from citizens LG collects comments, prioritises and presents budget options CWG receive new draft from LG Third draft is presented to LG Council which approves the budget 12

NALAS Survey GENERAL OBSERVATIONS Urban – Rural dimension – territorial reorganization – effects -> reference: paper of Dr. Keith Brown Building trust – anticorruption measure (there is less corruption than perceived…) 13

Fundamental questions NALAS Survey Fundamental questions Essence of the problem: 1. Who is in charge of the budget? Who is in charge of the local budget? - Who elects the Mayor? Who appoints candidates for local elections? Is the party in charge or the citizens? 2. Social behavior patterns Paradigm: the government is there to take care of us (the citizens) 14

Strategic Planning vs. PB Open issue: Strategic Planning vs. PB Capacities are being developed for effective Strategic Planning / Local Economic Development Participatory approach during long term (multiyear) planning vs. annual budgeting ( if SP not participatory, PB can radically change core decisions of the SP) 15

need special attention Aspects which need special attention Multi-ethnical dimension Social Inclusion Displaced (in informal settlements) Unemployed Women 16

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