Practicality of Stakeholder Participation in the Local Government Budgeting System in Zambia

Table of Contents

Abstract

List of Figures

1 Introduction
1.1 Stakeholder Participation
1.2 Statement of the Problem
1.3 Objectives of the Study
1.4 Study Methodology

2 Review of Literature
2.1 Budgeting Concept
2.2 Participation Concept
2.3 Participatory Budgeting Definitions
2.4 Participation in the Budgetary Process
2.5 Key Stakeholders in Participatory Budgeting
2.6 Types of Participation in the Budgeting Process
2.7 Originality of Practical Participatory Budgeting

3 Zambia Local Government System
3.1 Village Productivity Committees and Ward Development Committees
3.2 One Party Participatory Democracy
3.3 Multi – Party Democracy
3.4 Provisions of the Local Government Act of 1991

4 Case study of Participatory Budgeting in Kabwe Municipal Council
4.1 Situation Analysis
4.2 Administrative Structure
4.3 Local Government Budget Process
4.3.1 Participatory Budgeting Implementation Activities
4.3.2 Formation of Zones and Resident Development Committees
4.3.3 Initiation of Participatory Budgeting Process
4.3.4 Stakeholder Consultation
4.3.5 Informative Sessions and Meetings
4.3.6 Findings and Comments
4.3.7 Challenges and Lessons Learnt

5 Options for Government

6 Conclusion

Bibliography

Acronyms and Abbreviations

Abbildung in dieser Leseprobe nicht enthalten

List of Figures

Figure 1.0: Kabwe Municipal Council – Participatory Budgeting Steps

Figure 2.0: Tabulation of the Resident Development Committee Project Submissions

Abstract

The paper focuses on the extent of stakeholder participation in budget making process at the local government. In the context of the study, the term stakeholder mean persons, institutions, organizations and groups of people who have direct or indirect interest in the budgeting process at any or all levels of the governance’s structure and activities thereof. The paper provides an analysis on the practicality of stakeholder participation or simply participatory budgeting in the local government system in Zambia using Kabwe Municipal Council as case study. An analysis of the challenges that the Government at the level of local government faces in its quest to incorporate participatory budgeting at the local level is also presented.

The direction of the paper focuses mainly on the general assessment of the conditions for effective participatory budgeting and its impact on the stakeholder community. Kabwe Municipal Council was ideally suitable for the study as the first pilot council to have practiced participatory budgeting in Zambia. The primary focus in the Kabwe Municipal Council case study is on the extent to which stakeholder participation is promoted in the budgeting process by measuring the extent against the conditions for effective participation in the budgetary process as advocated by Wampler (2000) in his “A Guide to Participatory Budgeting” paper. This is done to inform the researcher on appropriate conditions that need to exist at the local level to ensure effective implementation of participatory budgeting in Zambia.

The paper brings to light the notion of participatory budgeting as an on-going process that is linked to elements of direct and indirect democracy. It further proves that the concept does not reach its finality but is always developing as a step-by-step institutionalization of stakeholder participation in the budgeting process at the local level. The paper proves most of the participatory budgeting process in Kabwe Municipal Council to be in line with the most of the pre-conditions of Wampler with a few exceptions. The potential of participatory budgeting in Zambia is proved to be very much feasible but heavily depended on the political drive by the Government in power. The paper emphasizes facilitation of the immediate implementation of the Decentralization policy by Government as a precinct for participatory budgeting as it embraces most of the tenets of stakeholder participation in the budgeting process at the local government level.

1 Introduction

1.1 Stakeholder Participation

In most forms of governance, there is always this notion of stakeholder participation especially in the decision making process at the local government level. This is the probable reason why in most instances local government is regarded as “an area for stakeholder participation in governance” (Gaventa quoted by Smith, 2006). This stakeholder participation is mostly considered at the level of planning and development of “methodologies and tools for opening up these processes to greater stakeholder participation and influence” (Smith, 2006). This is usually visible where Stakeholder participation at the level of decision making is permissible on matters that have direct effect on their livelihood. However, stakeholder participation in the budgetary process has always been a contentious issue at all levels of governance. The fact is that participation in all areas of human endeavour has implications most especially on collectivity in the decision making process. In matters of budgeting, there are always competing demands which are highly contestable. These arise from the fact that to every decision there is always a form of bargaining among the interested parties. These forms of bargaining may be either overt or restrained.

Experience however seem to show that in most instances, stakeholder participation in decision-making has not been easy to achieve due to divergence views on the extent of participation by the powers that usually dictate the course of action on every decision. This is more pronounced especially on the issue of resource allocation to planned activities. Stakeholder participation in the budgeting process is not an exception. This is because every budget making process has its own implications. These arise from the fact that to every planned activity, there are cost implications. This makes allocation of resources contentious. Smith (2006) considers participatory budgeting “as the only channel that offers opportunities to those groups that are socially excluded or are living in poverty to participate meaningfully in processes”. By participating in the budget process, stakeholders’ needs and aspirations are influenced upon and eventually get reflected in the budget plans that finally get formulated at the local level. It is against this background that the study tried to explore the extent of participatory budgeting in Zambia using Kabwe Municipal Council’s experiment with participatory budgeting as a case study. In the context of the study, the term stakeholder meant persons, institutions, organizations and groups of people who had direct or indirect interest in the budgeting process at any or all levels of the governance’s structure.

1.2 Statement of the Problem

From the time of independence in 1964, subsequent Zambian governments have tried to put emphasis on the need to devise a system of governance that was effective for service delivery at the local level. Arising from this quest, a number of reforms were undertaken to effectively structure the governance system in Zambia. The commitment of subsequent governments in all these reforms laid on decentralization and stakeholder participation in decision making at the local level. Over time, Governments grappled with the problem of adopting a suitable mode of governance that was to facilitate sustainable stakeholder participation in the devised socio-economic development strategies. A critical objective of the local government reforms had always been to strengthen local authorities by decentralizing power to the local levels. Consequently, over the years subsequent governments have sought to design and implement a system of decentralized and democratic local government as a way of facilitating wider participation by the stakeholders in decision making process but without much success.

The thrust of the study therefore bordered on the understanding that participation in the budgeting process in Zambia had not been well practiced at all levels of governance. A number of factors ranging from political, social and economic have attributed to the situation. History has shown that local level budgeting in Zambia has always been a top-down process where only top officials of government and those who wedged political power determined the direction of the budgeting process. The determined process made it difficult for effective stakeholder participation in the budgeting process. The situation has continued to prevail even to the present despite a number of political pronouncements being made but to the contrarily.

Although potential has always existed for stakeholder participation in the budgeting process in Zambia, very little had been seen in terms of the actual implementation on the ground. This has been in spite of having a representative system of governance at the local level. Discontent among the represented has always been the order of the day. The reason being that the represented have in most cases felt very much left out in the final decision making process mostly on issues that pertained to their livelihood.

The bone of contention has been mostly on the decisions made at the local level that only favoured those who exerted influence in the decision making process at the expense of the vulnerable and the disadvantaged in society. Even the desire to devolve decision making to the local level by implementing the decentralization policy has not been a favourite to those who wedged political or economic power at the local level. In most situations, those who wedged power always advocated for exclusion of other stakeholders from participating in the decision making process. Arnstein (1969) regarded such a scenario as a form of “tokenism”, a situation that only allowed the “have-nots” to advice whilst the “haves” still retained the right to decide.

1.3 Objectives of the Study

The study mainly centered on the extent of stakeholder participation in budget making process with specific reference to the level of local government. The aim was to analyse the practicality of stakeholder participation or participatory budgeting in Zambia using Kabwe Municipal Council as case study. Further objective was to present an analysis of the challenges that the Government at the level of local government was facing in its quest to incorporate participatory budgeting at the local level. The direction of the study focused mainly on the general assessment of the conditions for effective participatory budgeting and its impact on the community. Kabwe Municipal Council was ideal for the study as it was the first pilot council to practice participatory budgeting in Zambia. The primary focus in the Kabwe Municipal Council case study was on the extent to which stakeholder participation was promoted in the budgeting process by measuring the extent against the conditions for effective participation in the budgetary process as advocated by Wampler (2000) in his “A Guide to Participatory Budgeting” paper. This was done to inform the researcher on appropriate conditions that needed to exist at the local level to ensure effective implementation of participatory budgeting in Zambia.

1.4 Study Methodology

Arising from the central objective of the study, qualitative methodology was found appropriate for the purpose. The availability of sufficient data on participatory budgeting process globally and for Kabwe Municipal Council in particular enabled the analysis of the available data using the desk study method. The desk study method was found to be objectively focused to the study’s central objective. To validate the data for its authenticity, interviews were conducted with relevant stakeholders in the budgeting process within and outside the premise of Kabwe Municipal Council.

2 Review of Literature

The starting point to participatory budgeting was the understanding of the two concepts. This arose from the fact that both concepts were prone to be interpreted differently depending on the context in which they were used. An explanation on the two concepts was therefore imperative.

2.1 Budgeting Concept

From the budgeting concept, the term “budget” was first derived. The understanding of the budget term was that it was “a financial plan of action that assisted in the orderly implementation of programmes or activities” (Gumboh, 2006). In a matter of fact, it reflected organizational or institutional policies. At government level, it was understood as an instrument with which national or local policies were interpreted. A budget as a planned financial plan was futuristic in that it considered future periods by setting objectives and targets to be achieved at the end of a future year of activity.

It therefore followed that Budgeting as a concept was “an annually repetitive process that followed a cycle of events from its initial formulation to the assessment of year - end results (Gumboh, 2006). In the formulation process, there were several stages. These ranged from mid-year progress review of the current budget stage followed by the assessment of revenue prospects for the preceding year. In the process, policy guidance was issued on which institutions/departments were to submit their estimates of expenditure for the preceding years. At the executive budget formulation stage, budget requests and analyses were brought together into one budget document for ratification by authorized entities. In other practices, budget adoption stage involved additional steps, depending upon the local practice, such as holding budget hearings before final approval of the budget for execution. As deduced from the above explanation, the budget cycle for a single annual budget extended for over a period of twelve months from the start of formulation to assessment of the year-end financial reports.

2.2 Participation Concept

Participation was another concept term that was prone to be interpreted differently according to the context in which it was applied. Theron (2008), for example, considered participation “as an inclusion of stakeholders in decision making process as well as in the implementation of those decisions contrary to the form of participation commonly practiced that only informed them.” Participation also applied to situations where opportunities were availed to persons previously excluded from taking part in the decision making process and activities (Cupido and Theron, 2002). It was the exclusion principle that took the centre stage in the perception. Omenya, (2003) however added another dimension of participation by considering it “as a means of accessing resources, through broader collaboration of stakeholders”. In certain situations, “participation hinged on the influence that was exerted on final decisions made in the process” (Andrews and Shah, 2002). Participation in the budget process was in some instances regarded as one of the fundamental rights that stood at the centre of democratic governance and human development. Its introduction into the participatory governance was thought of as a panacea to most of the developmental problems at the local level.

2.3 Participatory Budgeting Definitions

In literature, a number of definitions of participatory budgeting were provided. The definition provided by Wikipedia, (2012) seem to embrace most of the tenets of democratic deliberation and collectivity in decision-making in line with the concept of participatory budgeting. This was with the understanding that participatory budgeting afforded ordinary people the opportunity to take part in the allocation of municipal budget resources. In other words, it was an interactive process by which members of particular communities at the local level were “directly and indirectly engaged in the process at the identification, decision and implementation stages of the budgetary process“(Shah, 2007).

The initial process provided members of a particular stakeholder community the opportunity to identify a list of spending priorities and then have them developed into specific spending proposals by a selected group of budget experts before subjecting them for adoption by the general membership of the community. At the adoption stage, members of the community voted on which proposals to be prioritized for funding. The responsible institutions thereafter proceeded to implement the prioritized proposals as determined by the community.

2.4 Participation in the Budgetary Process

At every stage in the budgeting process, a wide range of stakeholders may be involved at the debate, analysis, prioritization and monitoring stages of project development and implementation. Seema, Youssef, Hilton, Roark and Shah (2001) identified stages in the budget process starting from the budget formulation and analysis stage where stakeholders got involved in the allocation of budgets according to priorities identified in the participatory process. The budget formulation and analysis stage was followed by the expenditure monitoring and tracking stage, the stage that involved stakeholders in the tracking of public spending to ensure that the expenditures were in line with the budget.

2.5 Key Stakeholders in Participatory Budgeting

Literature further revealed a number of key stakeholders in participatory budgeting. In the context of the study, the term stakeholder meant persons, institutions, organizations and groups of people who had direct or indirect interest in the budgeting process and activities thereof. This was at any or all levels of the governance’s structure. Whereas the main stakeholders at any level were local persons, groups, institutions and organizations situated permanently in those respective areas, external development partners either with or without local representatives were equally regarded as stakeholders in the process.

The role of stakeholders in the budgeting process is mainly to ensure that the advocacy for active and effective participation in the decision making process on developmental activities within the geographic areas was enhanced. This equally pertained to the financing of these activities as identified by the stakeholders themselves. For instance, some stakeholders may be involved in agriculture development activities while others could be involved in the health, education, business or water development activities. To ensure effective coordination of all these development activities, with emphasize placed on having one comprehensive participatory plan and budget developed from the lower levels all the way to the top. This was to ease implementation.

2.6 Types of Participation in the Budgeting Process

In analyzing the participation criteria in the budgeting process, two types were identified. These were direct and indirect participation. Direct participation provided the opportunity to members of a particular community to participate directly in the budgeting process of that community. This was a form of participation where issues of concern by stakeholders were directly presented for consideration into the budgeting process. Literature revealed that the direct form of participation in the budgetary process was however difficult to achieve in situations where a large number of people than expected made presentations into the budget process with the view that their opinions would be considered without any sanction by the authorities. The other side of the “coin” was in situations where direct participation even in smaller communities proved difficult to organize without much cohesion.

Indirect participation hinged on the aspect of representation in the budgeting process at the local level. In this form of participation, diverse groupings were only represented in the budgeting process through elected members. Representation was either in the Zone or Village Development Committee. These were committees specifically constituted and mandated to act on behalf of the community at every stage in the budgeting process. This was done with the recognition that community participation at every stage of service delivery was a key factor to development. Zone/Village development committees were therefore found to be appropriate channels for participation in community development activities. These committees were established at all levels of local government and comprised a cross section of community stakeholders.

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