Financing Local Government

image of Financing Local Government
Decentralisation is now taking place in the public administrations of most countries of the world. A critical determinant of the effective performance of local governments is finance – their ability to both mobilise financial resources and to use those resources effectively and efficiently.

This book explores the variety of methods used to ensure that fiscal decentralisation takes place alongside administrative decentralisation. It considers the range of revenue sources available, the design systems of intergovernmental transfers between central and local government, and the kinds of rules and procedures necessary to ensure that local governments use their financial resources appropriately.

The experiences described in this book will help local government managers, and national policymakers charged with local government finance issues, to ensure that they follow good practice in their own programmes of local government reform.



Decentralisation and the Implications for Local Government Finance

Decentralisation is not new. Almost every country in the world (except some very small states) has some form of sub-national government structure, whether to maintain control or to deliver public services across the country, or both. Sub-national structures range from elected state, provincial, municipal or local governments with high degrees of autonomy, to local agents of the central state with minimal discretion – with numerous variations in-between.


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