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Sustainable Fiscal Decentralization for Development Progress

Explore the importance of fiscal policies in decentralization for sustainable development. Learn about challenges, best practices, and the role of different stakeholders in driving effective fiscal decentralization efforts.

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Sustainable Fiscal Decentralization for Development Progress

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  1. Eidgenössisches Departement für auswärtige Angelegenheiten EDADirektion für Entwicklung und Zusammenarbeit DEZA Federal Department of Foreign Affairs FDFASwiss Agency for Development and Cooperation SDC Global Issues and Sustainable Development – 28.05.2008 Fiscal policy and decentralization

  2. Main stakes Decentralization is only sustainable, if it considers the 'revenue side of the coin' (not only expenditures) GISD / Simon Hirsbrunner

  3. Overview • Context • Obstacles • Good practices GISD / Simon Hirsbrunner

  4. Best answers • Policy dialogue • Multilateral and bilateral donors • Central and local governments • Advocacy • Civil Society • Capacity building • Local governments and administrations GISD / Simon Hirsbrunner

  5. Remaining challenges • Change of mindset of donors • Move the tax policy debate from the technical to the political sphere • Change of incentives of decision makers • Create political will for fiscal decentralization (central government) • Create incentives for central and local administration • role of ODA in this context (conditionality to raise revenues); GBS, SWAP GISD / Simon Hirsbrunner

  6. General importance of the context • Importance of prevailing institutions • Countries with existing and functioning decentralized political and administrative structures are more promising candidates for fiscal decentralization • General lack of awareness / engagement • Lack of awareness and missing engagement of the importance of fiscal decentralization • Civil society • Private sector GISD / Simon Hirsbrunner

  7. SDC Institutional framework SDC should mainstream fiscal aspects in its decentralization programs => Need of adequate training and resource allocation GISD / Simon Hirsbrunner

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