Fiscal Decentralization and Local Resource Mobilization in Nepal : The Case of District Development Committees and Village Development Committees

Resource mobilization refers to the collection and utilization of resources in an organized way to produce results according to the given system of governance. It is based on a flow concept in which the inflow and outflow of resources are the concerns of "who gets what and how much from whom". Basically, the flow of local resource is the concern of fiscal issue of the local government which focuses on how the local government generates the revenue measured in monetary unit to meet the level of expenditure incurred to provide services for the benefit of the local people. Therefore, the fiscal decentralization in relation to the local government is considered as an important means of the system of governance. The critical issues of governance in the context of local resource mobilization are: Who controls? Who decides? And how optimally resources are collected and distributed to use? and so on. Fiscal decentralization refers to the process of granting autonomy to the local self government to mobilize financial resources which shows how much central government cedes fiscal impact to sub-national governments. It is a bottom up planning approach with the aim of converging the people's participation. Nepal is a country rich in diverse resources. Considering the eminent role to be played by local institution to mobilize these resources, Nepal has adopted the principle of decentralization since 1960 and various acts and laws were enacted since then to strengthen the efforts. According to the present Local-Self Governance Act (LSGA)-1999, local resources consisting of the grants provided by the central government (matching and non-matching grant), local revenue (tax and non-tax) and loan (internal and external) could have been implemented by the respective local bodies. This paper, therefore, has attempted to analyze the present status of revenue collection and expenditure practices as well as its scope and challenges of Village Development Committees (VDCs) and District Development Committees (DDCs).

Responsive Governance and Decentralized Participatory Institutions An Analytical Study in Indian State of Andhra Pradesh

The concept of (good) governance has emerged as the essential part of sustainable development. Experience from different countries has shown that while good governance can help secure human well-being and sustained development, it is equally important to recognize that poor governance could erode individual capabilities as well as institutions and community capabilities to meet even the basic needs of sustenance for large segments of the population, particularly the poor, the disadvantaged and the marginalized sections. Democratic decentralization is considered vital for overall development. It is argued that decentralization leads to improved governance and better delivery, hence improving livelihoods and alleviating poverty. The relationship between decentralization and governance are manifold. Decentralization leads to transparency in policies, responsiveness of the policy makers, accountability of implementers, openness and enhanced flow of information, and hence reduces corruption. The state of Andhra Pradesh stood second while introducing the Panchayati Raj system in India in order to establish democratic institutions at the grassroots level. In the recent past, however, Andhra Pradesh had adopted different institutional arrangements in the name of participatory institutions as decentralized delivery systems. These emerging institutions effectively by-passed the democratic institutions and are also known as parallel institutions or community based organizations (CBOs) or user committees. Financially these institutions are much stronger than the PRIs. Important issues addressed in the paper include: how do the parallel institutions function and perform in achieving the stated program objectives? Have these institutions improved the delivery of pro-poor policies? What are the linkages between the participatory and the democratic institutions? The basic thrust of my empirical study done in the state of Andhra Pradesh is on accountability of institutions in fostering responsive governance.
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