PRESENTATION TO THE ECONOMIC ASSOCIATION OF ZAMBIA – 4 TH DECEMBER 2008 AT PAMODZI HOTEL Ministry of Local Government and Housing

1.0Introduction 1.1 Background Decentralistion is one of the 3 PSRP Others being Public Service Management (PSM) and Public Expenditure Management and Financial Accountability (PMFA)

Background The goal of the PSRP is to “improve the quality, delivery, efficiency and cost effectiveness of public services” to enhance the sector’s contribution in the Poverty reduction campaign. The Decentralisation component is based on the National Decentralisation Policy which was adopted by government on 18 th November, 2002 and launched on 20 th August, 2004.

Background The Policy provides for the strengthening of Local Government through devolution of additional mandates and matching resources to Councils. The vision of Government is to achieve a fully Decentralised and democratically elected system of governance characterized by open, predictable and transparent policy making and implementation processes, effective community participation in decision making, development and administration of their Local affairs maintaining sufficient linkages between the centre and the periphery Policy objectives ref. PP18 of the DP.

1.2Decentralisation Implementation Plan (DIP) This is a vehicle for implementing decentralisation policy and it has ten (10) components - Sensitization, civic Education and Consolidating a democratic culture -Legal and Regulatory Framework - Institutional and Human Resources Capacity Development -Local Development Planning and Budgeting -Financial Management and Accounting -Fiscal Decentralisation and Revenue Mobilization -Sector Devolution -Infrastructure Development and Management -Monitoring and Evaluation -Programme Management and coordination

2.0 Implementation Status Although the DIP was submitted to Cabinet Office in April 2006 for approval by Cabinet, the approval was not done until Cabinet was dissolved prior to the 2006 elections. After the 2006 general elections, Cabinet deliberated on the Decentralisation Policy and guided that the implementation plan should front load capacity development prior to devolution. Front loading capacity development necessitated re- arrangement of the DIP.

PROGRESS. Sensitization, Civic Education and Consolidating a democratic culture Communication Strategy developed. The National Decentralisation Policy has been translated into Seven (7) local languages and currently the Secretariat is procuring the continuation of the Television and Radio Programes to address more detailed and intricate aspects of decentralisation Sensitisation for key stakeholders including Members of Parliament undertaken

ii) Legal and Regulatory Reforms Documentation of pieces of legislation, policies, rules and regulations that are at variance with the National Decentralisation policy has been done. A preliminary report on legislative review of the seven devolving Ministries has been compiled. This report is being updated to cover the remaining Ministries.

iii) Institutional and Human Resource Capacity development. Identification of personnel and the structures to operationalise the National Decentralisation Policy has been done. Capacity strengthening programmes required for decentralisation through devolution have also been identified.

iv) Local Development Planning and Budgeting. Underpinning of local level democracy through Finalisation of formation of Area Development Committee in all remaining Wards.

v) Fiscal Decentralisation, Revenue Collection and Financial Mgt. Government has designed an intergovernmental fiscal transfer system focusing on Restructuring Grant, Recurrent Grant and Capital Grant Government has commissioned and is considering a report on broadening revenue sources for councils. Grants to councils have increased from 1% to 3% of the National Budget in the last two years Government has developed and disseminated the Finance and Audit Manuals for use by local Government. Training on how to use the manuals has just been concluded country wide. Under the grant system government has adopted performance based grants that measure compliance with policy guidelines (objectives) and other regulations.

vi) Sector Devolution Draft Sector Devolution Plans for all 13 devolving Ministries underway. The Draft Sector Devolution Plans provide positions of government Ministries and institutions on various issues related to the sector devolution process. The draft Sector Devolution plans also include definitions of functions to be devolved and associated organization structures: human, finance and asset, policy and legal implications of devolution on the Ministry and councils. Six (6) ministries have since approved the Draft Sector Devolution Plans Government has established Sector Devolution Taskforces in thirteen Ministries and institutions between January and April 2007.

Vii) Infrastructure Development and Management Contributed towards development of Public/Private Partnership (PPP) Policy and Legislation to enable Councils engage with Private Sector for service delivery.

Viii) Monitoring and Evaluation Key performance indicators based on the Decentralisation Implementation Plan have been developed and target set for monitoring implementation progress Government is designing the M&E system for the MLGH with support from Coop Partners. The M&E system will inform the monitoring of performance indicators as defined in the FNDP in particular and generally provide information on the performance of councils

IMPLEMENTATION CHALLENGES AND PROPOSED WAY FORWARD Approval of the Implementation Plan It is challenging to proceed with devolution prior to a definitive Cabinet position. Current progress based on the mandate of the Local Government Act Cap 281. Resistance associated with decentralisation. Perceived and real loss of power, authority and resources by various stakeholders

CONCLUSION Absence of effective Local Government institutions will undermine achievement of Democratisation and other developmental agendas eg MDGs.