THE PROBLEM OF THE POLITICAL AND FISCAL DECENTRALIZATION OF THE LOCAL
GOVERNMENT IN 2012-2019

The article contains a concept about Political and fiscal decentralization problem in Georgia during “2012-2019” For each democratic state strong local government and its political and fiscal decentralization is a fundamental principle of democracy. A local government is a form of public administration which, in a majority of contexts, exists as the lowest tier of administration within a given state. It contains political, fiscal and administration decentralization which means to transfer power from central government to municipality. In the way of Democracy and European integration as a still democracy development county, Local Government development and its Political and fiscal decentralization is an important and key issues for Georgia. Aim of the Article: To analyze the process and the problem of Political and Fiscal decentralization of Local Government in Georgia during 2012-2019. What type of problem we have and what is the main problem for Political and Fiscal decentralization of Local Government in Georgia. Despite all of reforms from independence to nowadays, political and fiscal decentralization of local Government is a problem for all governments in Georgia. The main reason for all of them was political control under the Local governments. After 2012, the hope that the new Government can implement real political da fiscal decentralization of local government was big. But reality is different. Despite two reforms of Local Government during 2012-2019, until now the problem of political and fiscal decentralization in Georgia is the same: no formal control of Local Governments, Most of Financial resources still have central Government, Local Governmnts have no possibility to implement their power independently, they have no own property and sufficient financial resources. In this article we give a recommendations how to improve political and fiscal decentralization aspects in Geogria and what the main problem is.

Download Full-text

Game Theory-Based Analysis of Local Governments’ Behavioral Dissimilation in the Third-Party Soil Pollution Control under Chinese-Style Fiscal Decentralization

Land ◽

10.3390/land10040389 ◽

2021 ◽

Vol 10 (4) ◽

pp. 389

Author(s):

Caihua Zhou

Keyword(s):

Local Government ◽

Soil Pollution ◽

Pollution Control ◽

Local Governments ◽

Central Government ◽

Fiscal Decentralization ◽

Third Party ◽

The Third ◽

Party Control ◽

The Third Party

The participation of a third party of the environmental service enterprise theoretically increases the level and efficiency of soil pollution control in China. However, Chinese-style fiscal decentralization may have a negative impact on the behaviors of participants, especially the local government. First, this paper conducts a positioning analysis on participants of the third-party soil pollution control in China and discusses the behavioral dissimilation of the local government under fiscal decentralization. Second, taking the government’s third-party soil pollution control as a case, a two-party game model of the central government and the local government is established around the principal-agent relationship, and a tripartite game model of the central government, the local government, and the third-party enterprise is designed around the collusion between the local government and the third-party enterprise. The results show that Chinese-style fiscal decentralization may lead to the behavioral dissimilation of local governments, that is, they may choose not to implement or passively implement the third-party control, and choose to conspire with third-party enterprises. Improving the benefits from implementing the third-party control of local governments and third-party enterprises, enhancing the central government’s supervision probability and capacity, and strengthening the central government’s punishment for behavioral dissimilation are conducive to the implementation of the third-party soil pollution control. Finally, this study puts forward policy suggestions on dividing the administrative powers between the central and local government in third-party control, building appraisal systems for the local government’s environmental protection performance, constructing environmental regulation mechanisms involving the government, market and society, and formulating the incentive and restraint policies for the participants in the third-party soil pollution control.

Download Full-text

THE ROLE OF LOCAL GOVERNMENTS IN REGIONAL FINANCIAL MANAGEMENT FOR THE HANDLING OF THE COVID-19 PANDEMIC

Yurispruden ◽

10.33474/yur.v4i2.10250 ◽

2021 ◽

Vol 4 (2) ◽

pp. 208

Author(s):

Fahrul Abrori

Keyword(s):

Local Government ◽

Research Methods ◽

Financial Management ◽

Local Governments ◽

Central Government ◽

Fiscal Decentralization ◽

The Government ◽

The Stability ◽

The Relationship

ABSTRAKPandemi Covid-19 yang terjadi di Indonesia membuat pemerintah membuat kebijakan-kebijakan sebagai stimulus untuk menjaga kestabilan masyarakat dan perekonomian. Pemerintah pusat memberikan kewenangan kepada pemerintah daerah untuk mengelola keuangan daerah untuk menangani covid-19 di daerah masing-masing. Hal ini disebabkan karena pemerintah daerah lebih memahami kebutuhan daerahnya. Permasalahan yang diangkat Pertama, bagaimana hubungan Pemerintah Pusat dan Pemerintah Daerah dalam pengelolaan keuangan untuk penanganan pandemi Covid-19? Kedua, Apa peran Pemerintah Daerah dalam pengelolaan keuangan daerah untuk penanganan pandemi Covid-19? Menggunakan metode penelitian yuridis normatif dengan pendekatan perundang-undangan dan pendekatan konsep. Hubungan Pemerintah Pusat dan Pemerintah Daerah dalam Pengelolaan Keuangan untuk Penanganan Pandemi Covid-19 yaitu desentralisasi fiskal yang mana. Peran Pemerintah Daerah dalam Pengelolaan Keuangan Daerah untuk Penanganan Pandemi Covid-19 yaitu dengan melakukan refocusing kegiatan, realokasi anggaran, dan Penggunaan Anggaran Pendapatan dan Belanja Daerah.Kata kunci: Pemerintah Daerah, Pengelolaan Keuangan Daerah, Pandemi Covid-19 ABSTRACTThe Covid-19 pandemic in Indonesia led the government to make policies as a stimulus to maintain the stability of society and the economy. The central government authorizes local governments to manage local finances to deal with covid-19 in their respective regions. This is because the local government better understands the needs of the region. The issue raised first, how is the relationship between the Central Government and Local Government in financial management for the handling of the Covid-19 pandemic? Second, What is the role of local governments in regional financial management for the handling of the Covid-19 pandemic? Using normative juridical research methods with statutory approaches and concept approaches. The relationship between the Central Government and Local Government in Financial Management for the Handling of the Covid-19 Pandemic is fiscal decentralization. The role of local governments in regional financial management for the handling of the Covid-19 pandemic is by refocusing activities, reallocating budgets, and using regional budgets.Keywords: Local Government, Regional Financial Management, Covid-19 Pandemic

Download Full-text

Dampak Desentralisasi Fiskal terhadap Volatilitas Belanja Pemerintah Kabupaten/Kota di Indonesia

Jurnal Ekonomi dan Pembangunan Indonesia ◽

10.21002/jepi.v19i1.879 ◽

2019 ◽

Vol 19 (1) ◽

pp. 118-138

Author(s):

Benedictus Raksaka Mahi ◽

Syarah Siti Supriyanti

Keyword(s):

Local Government ◽

Government Spending ◽

Local Governments ◽

Central Government ◽

Fiscal Decentralization ◽

Government Transparency ◽

Before And After

The volatility of expenditures sub-local derived from central government transparency in transfers to local governments may aggravate sublocal economy. This study aims to analyze the eect of fiscal decentralization to the level of volatility of local government spending in 230 sub-local in Indonesia. We use two periods, before and after the implementation of Law No. 28 Year 2009. The regression results indicate that the volatility of local government spending may decrease if the degree of fiscal decentralization increases, especially at the time when districts implement that law. As responsive taxation can provide incentives for smooth spending for sub-local government. ================================= Volatilitas belanja pemerintah kabupaten/kota yang berasal dari ketidakpastian transfer pemerintah pusat kepada pemerintah daerah dapat memperburuk perekonomian kabupaten/kota. Penelitian ini bertujuan menganalisis pengaruh desentralisasi fiskal terhadap tingkat volatilitas belanja riil pemerintah pada 230 kabupaten/kota di Indonesia serta membandingkan data sebelum dan sesudah implementasi UU No. 28 Tahun 2009. Hasil menunjukkan semakin tinggi derajat desentralisasi fiskal, cenderung menurunkan volatilitas belanja riil pemerintah kabupaten/kota karena kemampuan fiskal kabupaten/kota cenderung meningkat setelah implementasi UU tersebut. Pajak properti merupakan sumber penerimaan daerah yang dapat diprediksi sehingga pemerintah kabupaten/kota dapat mengelola belanja daerahnya dengan lebih pasti dan terukur.

Download Full-text

The Effect of Fiscal Decentralization on the Accountability of City / District Government Financial Reporting in Indonesia and the Regional Government's Financial Performance as a Moderation Variable

Volume 5 - 2020, Issue 9 - September - International Journal of Innovative Science and Research Technology ◽

10.38124/ijisrt20jul271 ◽

2020 ◽

Vol 5 (7) ◽

pp. 370-376

Author(s):

Wahida Nurmuthmainnah ◽

Syarifuddin . ◽

Mediaty .

Keyword(s):

Local Government ◽

Financial Performance ◽

Financial Reporting ◽

Local Governments ◽

Central Government ◽

Fiscal Decentralization ◽

Financial Statements ◽

Series Data ◽

Financial Reports ◽

Regional Governments

This study aims to provide an overview of the effects of fiscal decentralization in proxies with regional independence and regional dependence on the central government regarding accountability of regional financial reporting and financial performance of Local Governments as moderating variables. The type of data used in this study is secondary data, panel data in the form of time series data from 2015 to 2017 and cross section data from 509 districts / cities in Indonesia. The sample selection in this study was purposive sampling by creating a cluster of western, central and eastern regions, so that 135 samples were obtained. The results showed that: (1) Regional independence had a positive effect on the accountability of local government financial reports. (2) Regional Dependence has a negative effect on the Accountability of Regional Government Financial Statements. (3) The financial performance of regional governments can moderate the influence of regional independence on the accountability of local government financial reports. (4) The financial performance of regional governments can moderate the effect of regional dependence on the accountability of local government financial statements.

Download Full-text

Local government modernization in Albania

International Journal of Public Sector Management ◽

10.1108/ijpsm-01-2017-0018 ◽

2018 ◽

Vol 31 (4) ◽

pp. 466-506 ◽

Cited By ~ 3

Author(s):

Elona Guga

Keyword(s):

Local Government ◽

Local Governments ◽

Historical Development ◽

Central Government ◽

Fiscal Decentralization ◽

Single Case ◽

Administrative Reform ◽

Current Debate ◽

Content Type ◽

The Impact

Purpose An attempt will be made to shed light on the course and pattern of the decentralization process by analyzing the historical development of local government and the territorial-administrative reform of 2015-2020 in Albania and the factors that have been shaping it. The scope is to understand the impact of the reform elements on the subnational governments and in general their overall impact on the government. The purpose of this paper is to fill the gap in the existing literature for Albania and at offering some insights on the administrative-territorial reform. Furthermore, it will contribute to the current debate on fiscal decentralization in South Eastern European (SEE) countries and the public management model implemented after the last reforms. Design/methodology/approach The first section analyzes the historical development of local government reforms from the 1990s to today and will help to identify if there is instrumentalism advocacy. The second section explains the determinants of the local government’s fiscal autonomy in Albania of the period from 2003 to 2016. Three indicators are used as proxies for fiscal decentralization: the proportion of subnational expenditure over national expenditure, of total subnational revenues over total revenues of central government and the indicator of own subnational revenues over total revenues of the central government. The data from the budget and the revised budgets are then compared. Findings Despite Albania’s commitment to decentralize its government functions, there is still work to do. The territorial and administrative reform has not generated the expected results. Almost 90 percent of the revenues still come from the central government’s unconditional transfers. Therefore, the Albanian Government should build capacities and skills, and train the employees of each level of government that currently benefit from international assistance. Research limitations/implications The analysis represents a single case study on the territorial-administrative reform in Albania. Its implementation started in 2015 and it is probably too early to discuss outcomes. However, it might be useful to analyze the first results after a two-and-a-half-year period of implementation of reforms. Despite contributing to the existing gap in the literature, additional research will be necessary to better understand the decentralization process not only in Albania, but in all SEE countries. Practical implications It is necessary to first understand the lack of initial output, as well as the various challenges faced, in order to take the corrective measures on time. Originality/value This paper discusses in detail the reform adopted and the progress made by the Albanian local government units. The reform attempts to develop better relationships between the central and local governments and hence improve their service delivery, transparency and accountability. This paper is the first one that is attempting to analyze the initial output of the territorial-administrative reform of 2015-2020.

Download Full-text

Inovasi dan kreativitas Public Service Era Otonomi Daerah sebagai Modern Local Government

Yurispruden ◽

10.33474/yur.v4i2.11216 ◽

2021 ◽

Vol 4 (2) ◽

pp. 175

Author(s):

Afifuddin Afifuddin

Keyword(s):

Local Government ◽

Public Administration ◽

Public Service ◽

Local Governments ◽

Local Community ◽

Central Government ◽

Regional Government ◽

Regional Autonomy ◽

The Government ◽

The Right

ABSTRACTThe implementation of public services is still going on with the old public administration practices. Therefore, it is time for the bureaucracy to change its mindset. The development of the paradigm of public administration can bring enlightenment to the bureaucracy. Public Service innovation and creativity is one of the right solutions in the era of regional autonomy in achieving the welfare of modern regional government. The Indonesian state in running the government, the relationship between the central government and local governments must be well and harmoniously established. The intertwined goal is for the prosperity of the people. Regional autonomy can provide flexibility for regions to innovate and create local community creativity as material for local government policies. Therefore, several important discourses in Public Administration Science can be a reference for modernizing the administration of local government in the era of regional autonomy. Keywords : Innovation, Public Service Creativity, Regional Autonomy, Center, Region and Local Government ABSTRAKPenyelenggarakan pelayanan publik masih saja terjadi praktik-praktik old public administration. Oleh karena itu sudah saatnya birokrasi merubah mindsetnya. Perkembangan paradigma administrasi publik dapat membawa pencerahan bagi birokrasi. Inovasi dan kreativitas Public Service merupakan salah satu solusi yang tepat di era otonomi daerah dalam mencapai kesejahteraan pemerintahan daerah yang modern. Negara Indonesia dalam menjalankan pemerintahan, hubungan pemerintah pusat dan pemerintah daerah harus terjalin dengan baik dan harmonis. Tujuan yang terjalin tersebut untuk kemakmuran rakyat. Otonomi daerah dapat memberikan keleluasaan bagi daerah untuk melakukan innovasi dan kreativitas masyarakat setempat sebagai bahan kebijakan local government. Oleh karena itu beberapa wacana penting dalam Ilmu Administrasi Publik dapat menjadi rujukan untuk memodernisasi penyelenggaraan pemerintah daerah dalam era otonomi daerah. Kata Kunci : Inovasi, kreativitas Public Service, Otonomi Daerah, Pusat, Daerah dan Local Government

Download Full-text

The Effects of Local Government Characteristics and Audit Opinion on the Performance of District and City Governments in Indonesia

Jurnal Dinamika Akuntansi dan Bisnis ◽

10.24815/jdab.v5i2.9057 ◽

2018 ◽

Vol 5 (2) ◽

pp. 151-162

Author(s):

Evada Dewata ◽

Hadi Jauhari ◽

Siska Aprianti ◽

Eka Nurfa Hijria

Keyword(s):

Local Government ◽

Local Governments ◽

Central Government ◽

Fiscal Decentralization ◽

Capital Expenditure ◽

City Governments ◽

Audit Opinion ◽

Negative Effect ◽

District Government ◽

Positive Effect

This study aims to examine the influence of district and city characteristics (fiscal decentralization ratio, dependency level on the central government, capital expenditure, age, regional status, population) and audit opinion on the performance of local and district government in Indonesia for the period of 2013-2015. Population of this study consists of all local government units of districts and cities in Indonesia for the years of 2013-2015. The purposive sampling method was used resulting in a total of 1,158 samples for three years period observations. The results of this study indicate that the variables of age area, population, and audit opinion have a positive effect on the performance of the studied Districts and Cities. Conversely, the dependency level on the central government has a negative effect on the performance of studied local governments. However, the ratio of fiscal decentralization, the capital expenditure, and the regional status have no effect on the performance of the local governments

Download Full-text

Partial Fiscal Decentralization and Local Government Spending Policy

e-Finanse ◽

10.2478/fiqf-2018-0017 ◽

2018 ◽

Vol 14 (3) ◽

pp. 21-31

Author(s):

Agnieszka Kopańska

Keyword(s):

Local Government ◽

Basic Principle ◽

Government Spending ◽

Local Governments ◽

Local Authority ◽

Fiscal Decentralization ◽

School Education ◽

Financial Resources ◽

Empirical Literature ◽

Local Finance

AbstractThe aim of this paper is to analyze how limits in revenue and spending autonomy of sub-sovereign governments influence their decisions. Revenue and spending autonomy indicators for Polish towns were established and used in analysis on school education expenditures during 2003–2016. The influence of limits on revenue autonomy on municipal spending has been extensively addressed in both theoretical and empirical literature. However, studies related to spending autonomy are rare. The analysis presented in this paper suggests that when limits exist in spending autonomy, more decentralized tasks are crowded out by regulated obligations. That is why the spending autonomy analysis is important to evaluate the equity between local units and the adequacy of local revenues to decentralized expenditures.The basic principle of local finance is that there should be an adequate relationship between the financial resources available to a local authority and the tasks it performs. However, in practice, the assessment of whether this has been achieved is very difficult. Often, only problems with the solvency of local governments indicate that we are dealing with a poorly constructed system of local finances. The expenditure autonomy indicator proposed in this article is a tool that provides a way to indicate problems with the adequacy of revenues before such anextreme situation occurs.

Download Full-text

Fiscal Decentralization and Alternative Financial Sources for the Local Self-Government in Republic of North Macedonia - Overview

SEEU Review ◽

10.2478/seeur-2021-0006 ◽

2021 ◽

Vol 16 (1) ◽

pp. 14-29

Author(s):

Jeton Mazllami

Keyword(s):

Local Government ◽

Local Governments ◽

Central Government ◽

Good Governance ◽

Fiscal Decentralization ◽

Local Governance ◽

Candidate Country ◽

Potential Candidate ◽

The European Union ◽

The Republic

Abstract Local governance in developing countries demonstrates many problems related to financial sources and good governance of their finances. Local Self-Government (LSG) units in the Republic of North Macedonia are very small which results in a lack of capabilities to raise enough funds to offer delegated services. The local government in the Republic of North Macedonia centralizes almost all public finance. Local budgets depend heavily on state transfers and donations from the central budget. The lack of funds remained a crucial problem even though there were some attempts for the decentralization process. Practically, governments in many of the local governments in North Macedonia could not secure their resources. In this way, they could come with specific charges, but all taxes are decided by the central government. The practice showed that local governments before borrowing needs to be approved by the Ministry of Finance. The Republic of North Macedonia as a potential candidate to join the European Union should make several changes regarding the legislation during the process of accession to benefit from being a small candidate country. The main aim of this paper is to investigate alternative financial sources such are Municipal Bonds, Partnership Sukuk securities, and PPP. Unfortunately, many financial alternatives have not been able to be implemented due to failures in reforms and good financial governance. But they remain an open opportunity for developing a local government in the future.

Download Full-text

Fiscal Competition Among Local Governments after Fiscal Decentralization

Business and Entrepreneurial Review ◽

10.25105/ber.v5i1.1010 ◽

2016 ◽

Vol 5 (1) ◽

pp. 48

Author(s):

Haryo Kuncoro

Keyword(s):

Local Government ◽

Local Governments ◽

Central Government ◽

Fiscal Decentralization ◽

Spatial Interaction ◽

Government Expenditures ◽

Fiscal Competition ◽

Intergovernmental Grants ◽

Intergovernmental Transfers ◽

Local Government Expenditures

Spatial interaction among local governments in fiscal setting decisions is receiving increasingly attention in the applied public economics literature. Spatial interaction models rely on the presence of an externality from local budget making, that is external effects originate from inter-jurisdictional resource flows due to tax competition for a mobile base, or from local public expenditure spillovers into neighboring jurisdictions. Similarly, the intergovernmental grants competition exists when there is a rivalry among local governments to get them from central government. This paper attempted to identify how great the fiscal competition among local governments in Indonesia. Using spatial statistics, we concluded that the fiscal competition among municipalities was greater compared to the pre fiscal decentralization period. It seems that the local tax setting and expenditures decisions in particular municipality can be attributed to the mimicking behavior to neighbor regions. Also, we found that the fiscal competition among municipalities could be attributed negatively to the fiscal disparity. Those imply that in the regional autonomy era the local governments tend to increase their local own revenue intensively and demand for intergovernmental grants in order to finance their expenditures. In the long run, they could lead to the high cost economy, worsening fiscal dependency, and inefficiency of local government expenditures. Those findings above suggest that the distribution of intergovernmental transfers among regions should consider the local tax effort and the services minimum standard plays an important role to achieve the efficiency of local government expenditures.

Download Full-text