Decentralization or formula for strong centre

Decentralization
Decentralization means the transfer of authority and responsibility for public functions from the central government to subordinate governments, organizations and/or the private sector. It is complex and multifaceted concept. There are different types of decentralization. These should be distinguished from one another because they have different characteristics, policy implications, and conditions for success. Various types of decentralizations include, political, administrative, fiscal, and market decentralization. Though these are distinct forms of decentralization, they frequently overlap and appear in different combinations across many countries. Political decentralization is aimed to confer common people more power in public decision-making. Usually it is associated with pluralistic politics and representative government. It promotes democratisation and empowers common people to formulate and implement policies. It ensures greater participation of diverse interests in society resulting in informed and considered decisions. It aims of the development of pluralistic political parties, the strengthening of legislatures, encouragement of local healthy political and public interest groups. If we go through the decentralization plan announced by the present military government, we don't see any of these characteristics. Instead the political parties have been barred from taking part in the proposed elections, which is quite contrary to the very concept of the political decentralization. Administrative decentralization is meant to redistribute authority, responsibility and financial resources. It consists of the transfer of responsibility for the planning, financing and management of most of public functions from the central government and its agencies to suitable subordinate or regional or functional authorities. There are three major and distinct forms of administrative decentralization: (1) deconcentration, (2) delegation, and (3) devolution.

Deconcentration
Deconcentration is the weakest form of decentralization. It is used mostly in unitary states, in order to redistribute decision making authority and financial and management responsibilities among different levels of the central government. Sometimes it is used to merely shift responsibilities from central government officials in the capital city to those working in regions, provinces or districts, at other times it used to create strong local administration under the supervision of central government ministries. The decentralization plan unfolded by the present military regime appears more close to this form of decentralization. The local district governments apparently appear to be under the provincial set-up, but if we trace the hierarchy of the bureaucratic and police officials (DCO and DPO),

we can easily see that their final control have been kept under the central government, not under the provinces. The military government's plan has in fact diluted the provincial authority, but has retained its own (central) power strings intact. The provincial authority has been deconcentrated more than the federal authority. Resultantly, the federal control over the districts has comparatively strengthened. Since Pakistan has four distinct provinces with their own thousands of years old history and culture, this form of deconcentration, which is more a dilution of provincial authority than a true decentralization with provincial autonomy, sooner or later it is most likely to be rejected by the people in Sindh, Balochistan and NWFP.

Delegation
This is a more extensive form of decentralization. The central governments transfer responsibility for decision-making and administration of public functions great deal of discretion powers. In the proposed decentralization plan, the decision-making powers of local Nazims (local council administrators) are restricted to local day-to-day affairs only. They have no role in policymaking; rather their role is restricted to implementation of the pre-fabricated policy. According to the proposed plan, they do not have any power to make policy decisions or participate in any policy dialogue. Thus there will be no participation in policymaking by people from grassroot level. The proposed plan of the military government cannot be called as delegation of authority and power at all.

Devolution
Through devolution transfer authority for decision-making, finance, and management to quasi-autonomous units of local government with corporate status. In the proposed plan of the military government, the local councils do not have quasi-autonomous status. They do not have power to raise their own meaningful revenues, most of which are levied by the central government. They will have to depend mostly on the grants and charities of the central government, directly or through the provincial governments. The local councils do not have clearly recognised authority over the resources within their geographical boundaries. Moreover, it is this type of administrative decentralization, which underlies most political decentralization. The proposed plan of the military also fails to qualify this merit. Financial decentralization is the foundation of whole exercise. In order to carry out its functions, the decentralized local government will require adequate revenues. The revenues are either to be generated locally or transferred from central government. In our case, the revenue generation capacity at the local level is almost negligible. The local government will have to rely completely on the central government for its monetary needs. The local government will not have power to make spending according to their wishes. They will not have surety of funding they will receive from the federal / provincial governments.

There cannot be true decentralization unless all of the taxes levied by the central government and revenue generated by centre from provinces through their natural resources exploitation, etc. are transferred completely to provincial governments and a formula for distribution to various districts is made a provincial subject. Decentralization is said to be incomplete without privatisation and deregulation. These are usually accompanied by economic liberalization and market development policies. Businessmen, community groups or NGOs then carry out the responsibilities previously carried out by the government.

Privatisation
By privatisation it is meant that the provision of goods and services, which government use to carry out, is handed over to free market. The government and private sector may start "public-private partnerships". The functions previously monopolised by the government are allowed to be performed by the private enterprises. The local governments may contract services of private enterprises for serving the general public. In the proposed plan, it is kept completely obscure of how this will be achieved. Will the local government be really in position to build public-private partnerships and contract services of private enterprises for its people? The level of proposed fiscal decentralization will not allow all this to happen. Moreover, it is argued that the receipts of privatising the public sector enterprises are being spent in clandestine way. It is not clear whether their receipts will in future be handed over to provinces or to districts. More probably, the federal government will continue to enjoy the privatisation receipts for financing its own project. Chances are that the privatisation proceeds will mainly go to meet defence and nuclear program expenditure.

Deregulation
When the services provided by the government or its monopolies are privatised and deregulated, the private enterprise competes one another and provides better and cheaper services to general public. This is not possible under current local government plan. For example, the electricity is provided by WAPDA alone, Pakistan State Oil mostly handles Petroleum products, telephone services are provided by PTCL, etc. There are no competitors for them in their fields. These giant monopolies will continue to exploit the local governments. The local people will not be in position to get any benefit from the proposed local government plan.

Local Government Plan 2000

The proposed local government plan is said to be based on five fundamentals: devolution of political power, decentralisation of administrative authority, deconcentration of management functions, diffusion of the power-authority nexus, and distribution of resources to the district level. The proposed plan is

more a type of vague deconcentration rather than a true decentralization. The power-authority nexus is claimed to be diffused, actually, it will intensify. For example, if such a nexus develop between the district Nazim and District Police Officer, it can be a disaster for the political opponents of the Nazim. Similar nexus with other officials of the district can result in misuse of land allotment, awards of contracts for goods and service delivery, etc. Although it has been said that the administrative set-up will be rationalised by defining lines of responsibility clearly, and providing protection against political interference and transfers on non-professional grounds, it is not clear who will do this, how and when? It has been proposed that the provincial financial resources will be distributed to local governments through formula-based fiscal transfers and decentralisation of specified taxation powers. Whereas the government has pledged to decentralize the provincial financial resources, there is no mention of decentralization of federal financial resources to the provinces, which had been demanded, by the provinces for a long time. It is clear, the military government wants to dilute the provincial say and authority and the local government plan has been engineered for achieving the same purpose. Without true fiscal and financial decentralization, the whole exercise will be futile from people's point of view. It will only, serve to consolidate the hold of the centre over the districts. The centre will be in a position to easily deal and manipulate several hundred scattered and weak power centres in the shape of districts and their Nazims, in sharp contrast to four powerful power centres, the provinces. The city districts are planned to appease some ethnic elements in Sindh province. Separation of Karachi from rest of the province of Sindh has been on cards since long time. Many governments and ethnic organizations, in order to truncate Karachi from the rest of the Sindh have been playing many tricks every now and then. They however, could not find any procedure through which it can be justified. There is no Sindhi in 'National Reconstruction Bureau' (NRB) who has prepared this plan. Only some ethnic non-Sindhis were taken into the NRB with aim to devise the local government plan in such a way so that Karachi can be, for all practical purposes, separated from the rest of Sindh. They did their duty and proposed separation of Karachi from the rest of the Sindh under the guise of the local government plan. On one hand, large urban centres have been proposed to be truncated from the rest of the rural areas, as Karachi is proposed to be snipped from the rest of the Sindh. The people of the rural Sindh (Sindhis) will have no say in the affairs of the Karachi (majority being non-Sindhis). On the other hand, smaller urban centres, which are separate entities under the current system, with their own municipal committees, are proposed to be merged to the taluka councils. In other words and in ethnic Sindhi / Non-Sindhi context, the rural Sindh (Sindhi's) cannot enjoy the benefits accorded to Karachi (Non-Sindhis). Whereas, smaller urban

centres (majority Non-Sindhis) have been allowed to enjoy benefits, which may be enjoyed by the rural taluka councils' areas (Sindhis). It has been claimed that these acts will mitigate the rural-urban centres, however, it is clear that these measure will intensify ethnic and rural-urban tensions. According to the proposed plan, if any resolution passed by any district council is considered against the public interest, the provincial assembly cannot set aside the said resolution unless the governor also accords his/her approval. Since the governors of provinces are appointed and controlled by the federal government, the proposed district councils will be more in control of the federal government, than in control of the provincial government. This will clearly tilt the balance of power more towards the federal government. This is against the most popular demand of the provincial autonomy by the people of Pakistan. Though it has been proposed that the post of Deputy Commissioners will be abolished, there has been no categorical assurance that the office of District Magistrate will also be abolished. Separation of judiciary from executive was constitutional requirement but every government postponed it indefinitely on one pretext or the other. The present military government has also been indecisive of this and has kept this decision in pending for reasons better known to them. The document of the proposed plan reveals that the law and order will continue to be the provincial subject. At the same time the document also says that the law and order will be responsibility of the districts. Law and order police will be different from the prosecution police and the investigations police. The later two have been proposed to be not under control of the district. It has not been revealed how the files will move, how people will lodge the complaints and how criminals will be detected and prosecuted. The separate police forces for law and order, investigation and prosecution are feared to increase red-tapism. When world is moving towards having one-window operation for most of the civic functions, the reforms in Pakistan continue to make system more and more complicated. Since the police chiefs of capital cities, Karachi, in particular will be all powerful, "independent and self contained", any nexus developing between him and his Nazim will be very dangerous, so much so that the provincial government will be helpless to deal with them unless the governor, who happens to be representative of the federal government wishes so. This can be termed as a virtual federal rule over the city districts. Police complaint authority: The chairman of the Police Complaint Authority (PCA) will be appointed by the Chief Minister (CM) of the province from the members, which will be appointed by the Provincial Home Minister from the panel recommended by the Provincial Public Safety Commission (PPSC). If we dwell slightly deeper and see the constitution of PPSC, it will be clear that the federal government is also in fact manipulating the PCA. Notable point is that the

CM and Home minister will only chose chairman and members of PCA from the panel recommended by the PPSC. Provincial Public Safety Commission: The Provincial Public Safety Commission (PPSC) will be formed to approve annual policy plans formed by the provincial police chief and monitor provincial police performance. It will also coordinate functions of similar public safety commissions at lower levels (e.g. districts). It will have twelve members. Only six will be elected by the provincial assembly The rest of the members will be appointed by the governor on recommendation of the Chief Justice of the High Court (one member), the Prime Minister (one member) and the Chief Minister (one member). It is clear that the final authority to appoint the PPSC rests with the provincial governor, who happens to be representative of the federal government. Loopholes have been left for the federal government to interfere in the constitution of the PPSC and manipulate its functions, for example, constitution and functions of police complaints authority. The federal government will, clearly be in a position to use the agency of police force to exert its coercion over anyone it wishes to. This is certainly not the decentralization; instead, after the dilution of the provincial authority, it can only be termed as a modified form of centralization. National Public Safety Commission: According to the proposed plan, a National Public Safety Commission (NPSC) will be formed to approve annual plans of the federal law enforcement agencies and monitor their performance. The NPSc will have twelve members, half of which will be members of the National Assembly. These will be 'elected' by the National Assembly. Clearly, all of these members will be from Punjab save one mandatory member to be elected from each province. Panel of the Chief Justice of Pakistan, the Prime Minister and the Chairman, Federal Public Service Commission will select rest of the members. The provinces of Sindh, Balochistan, and NWFP can claim only one member each in the NPSC. The power to select / elect other members will rest with Punjab, having majority in National Assembly and control of the Federal Government. Provincial Finance Commission: So far, in provincial set-up, the distributions of provincial finances among districts have been quite harmonious. The present government has, through the proposed plan, tried to give impression that the distributions of provincial finance have been unjust and to 'ensure' a transparent, credible and fair system of transferring funds to the districts, a Provincial Finance Commission has been proposed. It appears that the NRB desperately needed something substantial to show that they have done some work and justify the expenditure over its constitution. Therefore, they invented a problem and suggested a solution. The NRB may take this as another feather in their cap, but the ground reality is that this step may create suspicions among various districts, which may start demanding more share in provincial resources and thereby promoting district-provincial disharmony. The provincial assembly was the best forum to deal with the issue. The provincial assembly could have formed

standing committee or special committee for distribution of provincial resources from more affluent areas to the disadvantageous areas. The proposal of PFC is nothing but eyewash.

Provincial Autonomy
The decentralization is not a panacea for all ills. It may not always be efficient. It can result in the loss of economies of scale and control over scarce financial resources by the central government. The services proposed to be delivered by the local government may be delivered less efficiently due to absence of strong administrative or technical capacity at local levels. The proposed decentralization will make it difficult to coordinate provincial and national policies. The nexus developing between Nazim, DCO and DPO may make the local elites (Nazims) stronger who may start victimizing their political opponents. Distrust may develop between public and private sector, which may undermine the cooperation and service delivery at local level. If assessed impartially, the lowest organizational level of government at which functions can be carried out efficiently and effectively is the level of provincial government and the functions that are not to be provided by the government need appropriate and transparent privatisation. Economists justify decentralization on the grounds of allocative efficiency. The type of decentralization best suited depends on the economies of scale affecting technical efficiency. In economics, the ultimate form of decentralization is the market. Politically, administratively and terms of service provision, we need not decentralize all services from provinces to districts. However, there is great need for decentralization of many federal functions to the provinces. Many federal ministries are mere duplicates of provincial department. There is need to transfer these and other functions from centre to the provinces to exploit the economies of scale and achieve an allocative efficiency. The problem of centralized systems is said to be geographical distance as well as lack of knowledge about local circumstances and wishes of the people. There is also variably wide gap between local people and the central government. More often the decisions of the central government are not based on the wishes of the local people. Hence, it is said that the affair of the people should be managed by themselves. The power is devolved from a central system to decentralized system coupled with empowerment of people. The proposed decentralization plan in Pakistan makes districts its focus of attention, not the provinces. In case of, if the power were devolved to provinces, much of the problems of centralized systems would be solved. Not only geographical distances would become less, the provincial governments being better aware of the local conditions would be in better position to devise district government structure, which suits to their province. It is clear that only a structure of local government is being changed. Real power, financial and ownership of natural resources is not being devolved. The districts will remain at the mercy of the federal government, who will be able to bypass the provincial government to manipulate the local administration of the

proposed districts governments. Though the newly proposed structure may intensify participation and involvement of the local people in the local day to day affairs, in absence of availability of financial and natural resources they will not be able to take any meaningful policy decisions, especially long term planning.

Country circumstances
The circumstances of one country differ from the other. The National reconstruction Bureau has failed to take this factor into consideration and imported a local government plan from theoretical sources abroad. They have made some arbitrary changes to make it palatable to the central government and recommended it for implementation. The NRB need to know that institutional instruments that establish decentralization have to be shaped to the specific conditions of individual countries. In our country specific conditions, for example, the decentralization in shape of complete provincial autonomy would have been a better step instead of very complex local government plan. Another noticeable anomaly of the plan is that, while it has proposed a centrefriendly deconcentration, no step has been proposed to ensure equitable representation of the provinces in the federal government structure and functioning.

A centralized decision
In fact the very decision of decentralization has been made in a very centralized manner. There has been little participation from the people on which this system is being imposed. Some handpicked people of the Chief Executive have devised it. So much so that the NRB does not have a single Sindhi speaking member. In absence of any member of Sindhi origin, the planners have failed to incorporate the wishes of Sindhi speaking people. A template of readymade structure has been made, which Sindh has been asked to accept. The imposed system which weakens the provincial authority and provides opportunity of central government with direct interaction with the districts in every matter is highly likely to fail sooner than latter.

Real power not transferred

In the proposed decentralization in Pakistan, an attempt has been made to reform the structure of the local government and district administration. Real power, financial and ownership of natural resources is not being devolved. The districts will remain at the mercy of the federal government, who will be able to bypass the provincial government to manipulate the local administration of the proposed districts governments. Though the newly proposed structure may intensify participation and involvement of the local people in the local day to day affairs, in absence of availability of financial and natural resources they will not be able to take any meaningful policy decisions, especially long term planning.

Bottlenecks to remain there

Furthermore, in the proposed plan, the bottlenecks in decision making that are often caused by central government planning and control of important economic and social activities, will not be removed.

Financial cost of the proposed plan

This devolution plan is said to cost Rs 7.63 billion at the very outset. The final picture may be horrible. In wake of precarious situation of Pakistan's economy, which, more recently, has been on verge of collapse with foreign debt amounting to US$ 30 billion, is this plan a sensible option? Will it fare better than the muchdemanded provincial autonomy?

Provincial autonomy - the only way out

Under these conditions, it will not be out of place to suggest that the only practical solution to the ills with which Pakistan is afflicted with, is complete provincial autonomy in light of March 23, 1940 Pakistan Resolution at Lahore.