Irakli Kobakhidze: we have the political will for decentralization and the reform is strongly supported

05 Mar 2018
Irakli Kobakhidze: we have the political will for decentralization and the reform is strongly supported

“The Government at maximal extent strive to ensure successful planning and implementation of the reform”, - the Speaker stated at the presentation of the Municipal Development Vision. 

He elucidated the term decentralization. Municipal authority development has faced impediments since 90s and the municipal administration system available in the country was not based on administration principles.

“In classical terms, it is delegation of authorities and resources to the independent municipal entities in independent administrative terms. The Prime Minister has already outlined three main aspects of the reform – delegation of authority, delegation of resources and equipment of municipalities with respective administrative and human resources. We shall develop the municipal capacities. Municipal authority development has faced impediments since 90s and the municipal administration system available in the country was not based on administration principles. All the Governors and Mayors were appointed by the President.

Afterwards, we moved to the mixed system and established the municipal entities on the lower level – villages, boroughs and small cities. However, as these entities were not equipped with respective resources, the reform has failed. The municipal administration was not effective on the lower level. Then, Georgia accessed to the European Charter of Municipal Administration and undertook to establish decentralized municipal system. The new Law has been adopted on Municipal Administration became effective in 2006 and resulting in establishment of the single level municipal administration system. The reform could be successfully accomplished, though the main aspect still was delegation of authorities and resources to the municipalities. Due to the reform was not accompanied with delegation of authorities and resources, the reform could not be successfully accomplished”.

Planning decentralization was resumed in 2012, though the process was not completely successful as the emphasis was made on the administrative side.

The Speaker underlined that the objective of the strategy shall envisage equipment of the municipalities with due authorities. “The emphasis has been made on the administrative side, territorial basis, institutional arrangement, which is not of utmost importance, though still is the secondary aspect of decentralization. The main aspect is more authorities and resources for the municipalities. And we strive to make correct emphasis and our strategy shall aim at equipment of the municipalities with due authorities and financial and material resources. It requires complex strategy. Without realization of each aspect of the reform, for instance authorities without resources and resources without human resources etc., naturally the reform will not be successful. That is why we need the complex approach and we need to develop the uniform complex strategy for decentralization and it is the process already launched and I hope and even more – I am sure that it will be successfully accomplished”, - the Speaker stated.

As to fiscal decentralization, delegation of financial resources is one of the main aspects of the reform. “We often speak about the 7% index, which is the European minimum. Naturally, the standard is nowhere defined in the normative or stricter form, though based on European practice, the 7% index is the European minimum for fiscal decentralization. I mean local incomes in regards with GDP which shall constitute 7%. We shall strive that our fiscal decentralization model to be approximated to European systems and models in mid-term run. We shall outline the plans for the mid-term and then equip the municipalities with extra funds. Fiscal decentralization model can vary. Hence, we need to make in-depth analysis of the model optimal for Georgian context, which taxes shall be distributed and how to equalize the transfer role, how to define equalization transfer formula etc.”

Particular attention shall be attached to property dissociation. This process started in 2006, though municipal units still enjoy restricted properties. “Here we need the analysis to define the ways of dissociation of the property resources between the state and the municipalities. The starting point shall envisage the qualitative increase as in authorities, so in financial and material terms. We speak that without resources, municipalities cannot be enhanced regardless of the institutional model. Without the resources for realization of authorities, to serve to the citizens, no institutional model can help”.

The Speaker emphasized importance of human resource development and noted importance of formation of the training and qualification system as the precondition for successful municipalities and one of the integral parts of the strategy. “Delegation of more authorities and resources on local level is related to risks when the human resources are not yet due developed. The risks may vary – starting from ineffective management up to corruption related threats. Hence, delegation of authorities shall be accompanied with development, requiring independent, complex approach. We shall establish the sustainable system for training of the servants, which is the necessary precondition for successful municipalities and shall be the integral part of the strategy now under development by the Government”.

Establishment of good governance principles and development of public service system on the local level is particularly important. This task is relevant for the central authority as well. He underlined importance of increased transparency and accountability in the municipalities and public involvement.

“In its essence, municipality means that the citizens are in charge of their affairs and are directly involved in public decision-making. It requires decentralization and more resources. Under the conditions of the scarce resources on the local level for the rural and urban needs, the motivation of the rural and urban residents to be involved in municipal administration is low, which conditions low index in this term. Delegation of resources and decentralization will increase the motivation of the residents to independently make the decisions. Though, it also requires due institutional mechanisms on urban and rural level. The analysis shall be held to establish the maximally effective mechanism to ensure public participation”.

The Speaker underlined the role of the National Association of Municipalities and stated that the Association holds the limited resources, though he hoped that the Association will become one of the parts of the reform planning.

“Those who have dealt with functioning of municipal systems in European countries, are well aware about importance of the role of such Associations in reforming. Often, the Association and Government are the equal subjects in the dialogue. At present, the Association resources are limited, though I hope that they will be increased and Association will become the part of the reform planning. The process has started and I want to underline participation of our international partners. I have named the number of donors involved in municipal enhancement for years and I am sure I have omitted any of them because it is impossible to remember all of them. The priority of our friends and partners is to enhance municipality in Georgia and we hope for their further support. As to the Government – the process is entrusted to the reliable party. The process is under Mr. Zurab Alavidze in person and I can state the same about the Parliament. Mr. Zaza Gabunia, the Chair of the Regional Development and Self-Government Committee is actively involved. Hence, I believe that the Government does its best to successfully plan and implement the reform, which requires complex strategy and vision”.

The Speaker underlined necessity of wide consultations upon planning. “The ultimate goal – in about 7-8-year run, is to approximate to European standards of municipal administration. We strive to increase financial resources of municipalities and thus, political will is paramount. I remember the processes in municipal administration since 2006 with lots of supporters, international society, donors and experts involved. Though, due to lack of the political will, it was never finalized. Now, we have the political will and I would like to thank the Government and Prime Minister in person for this political will and for supporting the reform. The Government and the Parliament conduct this process related to the reforming. Once again, role and merit of each and every of you is crucial in this process and we will never make mistakes again on the basis of the wide consultations for planning and implementing the reform”.

The presentation and the question-answer regime was moderated by the First Deputy Regional Minister, Irakli Matkava.