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Water and SanitationProgram for South Asia 1
Pakistan's Decentralization:Implications and Challenges forDelivering Water and Sanitation
Services
Raja Rehan Arshad
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Water and SanitationProgram for South Asia 2
Big Bang Decentralization
Local Government Ordinancepromulgated on August 14, 2001
Devolution of political and fiscal authority toelected Local Governments
Decentralization of administrative authority
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Water and SanitationProgram for South Asia 3
Pre-Devolution Context Four Provinces
Sind
Balochistan North-West Frontier Province
Punjab
Districts
Sub-divisions for deconcentrated arms of theprovincial government administration andtechnical line departments
W&S service delivery being a provincial
responsibility
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Water and SanitationProgram for South Asia 4
Major Impediments Overlap of jurisdictional assignment
More than one technical department responsible
for W&S Public Health Engineering Department, and Local
Government and Rural Development Department in ruralareas
W&S authorities and/or municipalities in urban areas
Centrally planned system of service delivery
Absence of accountability between theproviders and the client
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Water and SanitationProgram for South Asia 5
Major Impediments (Cont) Lack of capacity and appropriate institutional
framework for sectoral planning; preparation
of financially viable sector investments; andmanagement of demand responsiveinvestments
Absence of strategic vision in particular theimplications of urban and rural transformationfor the W&S sector.
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Water and SanitationProgram for South Asia 6
W&S Service Delivery Situation W&S systems investments without
consideration of O&M arrangements
Centrally financed, operated and managed In the last decade, move towards community
ownership, and operation and maintenance, butold systems still a major liability
Both in rural and urban, public sector water utilities
heavily subsidized by the government In rural areas, cost recovery less than 10 percent
In urban areas, cost recovery between 10 to 40percent
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Water and SanitationProgram for South Asia 7
Local Government Ordinance (LGO)
2001 Creation of approximately 100 district
governments and district councils (average
population of a district is one million) Creation of approximately 350 tehsil
municipal administrations and tehsil councils(average population of a tehsil is 500,000)
Creation of approximately 7,500 unionadministrations and union councils(population ranges from 18,000 to 28,000)
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Water and SanitationProgram for South Asia 8
LGO 2001 (Cont ) Direct elections have been held only at the
Union level The Deputy Mayor of the Union Council is a
member of the Tehsil Council The Mayor of the Union Council is a member
of the District Council All the union councilors in a tehsil and district
elect the Deputy Mayor and Mayor for therespective tehsil and district The Mayor and Deputy Mayor have to contest on
a Joint Ticket (one vote for both)
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Water and SanitationProgram for South Asia 9
Salient Features of the LGO 2K1 Complete fiscal authority to each level
However during transition, the province is maintaining somedecision making with regards to appointment of staff, setting
of tariffs and tax structures, etc. Rural Urban divide has been removed
Mega cities (million plus) have become City Districtsand the remaining districts are referred to asCommon Districts comprising urban and rural areas
District, Tehsil, and Union are not subordinate to oneanother
Principle of Subdiarity is the main theme
Tax base for each level
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Water and SanitationProgram for South Asia 10
Salient Features (Cont ) The new law has:
Decentralized service delivery providers
and assets (approximately 30 provincialdepartments ranging from social servicessuch as health and education to agricultureand soil conservation)
Removed jurisdictional and functionaloverlap of institutions
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Water and SanitationProgram for South Asia 11
Salient Features (Cont ) Introduced a new system of transparency and
accountability
Empowered local governments to enter into arange of institutional arrangements fromcommunity owned systems to contracting out andcontracting in of services
In order to ensure flexibility districtgovernments can transfer functions to thelower levels
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Water and SanitationProgram for South Asia 12
Salient Features (Cont ) The lower levels can assume functions
provided they finance them themselves and
get appropriate clearances To strengthen participation two institutions
have been created:
Village/Neighbourhood Councils, which will be
elected
Citizen Community Boards, which will have to beregistered with the district government
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COMMON DISTRICT ZILA COUNCIL-
DISTRICT
GOVERNMENT TEHSIL COUNCIL-
TEHSIL MUNIPAL
ADMINISTRATION
UNION COUNCIL-UNION
ADMINISTRATION
VILLAGECOUNCIL/NEIGHBOURHOOD COUNCIL
CITY DISTRICT ZILA COUNCIL-CITY
DISTRICT
GOVERNMENT TOWN COUNCIL-TOWN
MUNICIPAL
ADMINISTRATION
UNION COUNCIL-UNION
ADMINISTRATION
VILLAGECOUNCIL/NEIGHBOURHOOD COUNCIL
Different Tiers
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Water and SanitationProgram for South Asia 15
Key Outcomes (Cont ) Introduction of efficiencies through
encouragement of institutional and
organizational robustness, in particular theintroduction of: Subsidiarity
Co-Production
Public-Private Partnership Regional management of services including
regional utilities, management of multi-villageW&S systems, etc.
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Water and SanitationProgram for South Asia 16
Key Outcomes (Cont ) Focusing on direct lines of accountability with
a focus on information transparency and
localized decision making
Participation of citizens in decision making
and service delivery through the Citizen
Community Boards (CCBs), through which25 % of the development budget has to be
spent
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Water and SanitationProgram for South Asia 17
Key Outcomes (Cont ) Provincial Finance Commissions have
been established for intergovernmental
transfers Criteria includes:
Population
Poverty
Backwardness Resources
Incentive (Punjab only)
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Extension of Local Government Village Councils/Neighbourhood Coucils
An elected body representing the interests
of a particular village or neighbourhood
Citizen Community Boards (CCBs)
Non-profit organizations or stakeholder
associations working on developmentrelated and social welfare activities
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Water and SanitationProgram for South Asia 19
Tehsil Municipal Administration
(TMA) Responsible for Municipal Services in rural
and urban areas
Other levels of local government have noresponsibility and/or role for municipal servicesexcept in City Districts, where the District (Metro)level is responsible for macro municipal services
mainly (bulk water supply, etc.). Distribution andsolid waste is still the responsibility of TMA and/orUnion Administration
Average population of a tehsil is 500,000
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TMA (Cont ) TMA has the flexibility to balance
decentralized service delivery against
economies of scale Can have multi-village management
Single village management
TMA is responsible for three key components
of municipal management: Sectoral planning
Capital works
O&M
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TEHSIL MUNICIPAL OFFICER
Tehsil Council Secretariat
Audit
General Estab./Admin.
Finance
Accounts
BudgetAnnual
3 year rolling
Cost accounting
RevenueVigilance(Detection and prevention
of revenue leakages andlosses)
Survey(Revenue base current
and potential)
Regulation
Facilities, Markets
and Enterprises
Licenses
Regularisation of
Tenure of Katchi
Abadis
Land including Rights
of Way, Drains(Temporary tehbazari andencroachments)
Infrastructure andServices
Water Supply,
Sewerage/Drainage
Sanitation
(Solid Waste)
Roads, Streets and
Street Lighting
Fire Fighting
Parks and OpenSpaces
Traffic Engineering
Planning andCoordination
Spatial (PhysicalPlanning)
Land Use Planning
(Land sub-division,
zoning, land use)
Development
Facilitation/Control
Building
Facilitation/Control
Housing, Site
Development, Katchi
Abadi Amelioration
PlansCoordination and liaison
with neighbouring tehsils
and unions/VC
CO atTMA HQ
CO atnon-TMA
HQ
CO at non-
TMA HQ CO at non-TMA HQ
CO at non-
TMA HQ CO at non-TMA HQ
O&M Centres Working Under Chief Officer
TEHSIL MUNICIPAL ADMINISTRATION
ORGANIZATION
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Nature of the TMA
Body Corporate Consist of a Tehsil Nazim, Tehsil Municipal
Officer, Tehsil Officers, Chief Officers fromthe offices entrusted to the TMA
No distinction between a rural and an urbanarea in the law
Can further transfer responsibility to the lower
tiers along with transfer of resources Entire Tehsil space is a Rated Area for
Property Tax purpose
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Nature of the TMA (Cont ) Can contract out and contract in
services
Upper tiers can transfer responsibility tothe tehsil along with transfer ofresources TMA continues to be responsible for
regulating and monitoring service delivery Cannot borrow from the capital market
However, upper levels can extendadvances or give loans
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Functions of the TMA
The TMA is exclusively responsible, in theCommon District, for planning, capitalinvestments and operation and
maintenance of: Spatial Planning (land use and zoning)
Development Facilitation and Control (sitedevelopment and building control)
Municipal Services (water, sanitation, solidwaste, roads, streets, street lights,graveyards, fire fighting, traffic engineering,abattoirs, parks and open spaces)
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Composition
All present Town Committees, MunicipalCommittees and Municipal Corporations
Provincial Government Departmentswhich will be decentralised to the TMA:
Local Govt. and Rural DevelopmentDepartment
Public Health Engineering Department Housing and Physical Planning (apart from
the nucleus for the District)
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Subsidiarity Provision has been made in the law for
management of service delivery at the
lowest appropriate level Based on mutual consent, a function can
be transferred by the TMA to Union
Administration and/or Village Councils,along with transfer of correspondingresources
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Private Sector Participation Provision has been made in the law for
TMA to enter into contracts with the
private sector as long as the formerretains the responsibility of regulationand monitoring
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Authority to Restructure TMA has the authority to restructure the
sub-offices to meet the requirements of
a particular tehsil If a TMA transfers O&M responsibility to
Village Councils and Union Councils, it will
focus on regulatory and monitoring aspects A primarily urban TMA might want to
strengthen its urban centers
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Multi-Jurisdictional Management The law allows for Multi-Jurisdictional
management of services by Joint
Committees of Councils to achieveeconomies of scale and scope.
Bodies such as Joint TMA Committees
Intra TMA bodies such as Joint UnionCommittees (across more than one tehsil)
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Accountability The Tehsil Council and the Monitoring
Committees formed by the Council are
responsible for oversight over the TMA The Union Council can also form
committees to monitor the TMAs work
Village/Neighbourhood Councils andCCBs can also monitor TMAs work
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Defining the Resource Envelope There is a complete assignment of fiscal
authority TMAs main tax base (Own Source Envelope)
includes: Property Tax Transfer of Property Tax Licence Fee Rental of Municipal Property, etc.
Intergovernmental transfers from the
provincial divisible pool are made as a singleline transfer Property Tax is collected by the district on
behalf of the TMA
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Cont Complete fiscal authority allows the
TMA to plan both for the long and short
term, and to ensure that a hard budgetconstraint creates the pressure forlinking service coverage targets with
appropriate service levels
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Financial Management The law procedures and bye-laws
require the TMAs to establish cost
centers. The costing of services, bysectors and areas, will ensure that theTMA knows the nature and amount of
subsidy for each service and will bebetter able to make choices regardingthe level and extent of services
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Demand Responsiveness Co-production requirements (CCBs to
contribute at least 20 % cash towards
the capital cost) will ensure cost andmanagement sharing of services
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Situation After 2 Years Major capacity constraints
Some local governments moving ahead
Innovating new procedures and systems
Increasing OSR many-folds
Improving service delivery
Most local governments are still trying tofind their way around
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Situation After 2 Years (Cont ) Provincial governments are not allowing
local governments to hire/fire
City Districts are feeling the pressuremore as there is still some baggage ofthe old system which they are having to
carry, e.g., Water and SanitationAuthorities, etc.
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Challenges How to develop appropriate capacity at the
Local Government levels? What incentivedoes the upper level have to build capacity ofthe local governments?
How to align external assistedprojects/programs to the new decentralizedframework?
How to minimize recentralization?
How to discourage parallel financingmechanisms and formula
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Challenges (Cont ) Does the market respond to the lack of
capacity challenge by creating private sector
capacity? Does the new institutional structure allow for
cross-sectoral linkages between health,education and W&S?
Does decentralization bring about increasedpublic private partnership? What are thefactors that need to be considered?
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W t d S it ti
Challenges (Cont ) How can key sector reforms be facilitated like
corporatization of utilities, introduction of
regional utilities, interface between localgovernments and communities/SSIPs?
What incentive does the upper level have toregulate service delivery?
How far will political pressures interfere withdemand based service provision in adecentralized framework?