Table 3.1 Decentralization: Will it help the poor

TABLE 3.1 DECENTRALIZATION: WILL IT HELP THE POOR?
Pros	Cons
Promotes democracy because it provides better opportunities for local residents to participate in decision-making.	Undermines democracy by empowering local elites, beyond the reach or concern of central government.
Increases efficiency in delivery of public services; delegation of responsibiltiy avoids bottlenecks and bureaucracy.	Worsens delivery of service in the absence of effective controls and oversight.
Provides a chance for poor households to participate in local institutions and have their concerns recognized.	Local institutions mirror the anti-poor biases present at the state level.
Leads to higher quality of public services because of local accountability and sensitivity to local needs.	Quality of services deteriorates due to lack of local capacity and insufficient funds.
Enhances social and economic development, which rely on local knowledge.	Gains arising from participation by local people offset by increased corruption and inequalities among regions.
Increases transparency, accountability, and the response-capacity of government institutions.	Promises too much and overloads capacity of local governments.
Allows greater political representation for diverse political, ethnic, religious, and economic groups in decision-making.	Creates new tensions or ignites dormant ethnic and religious rivalries.
Increases political stability and national unity by allowing citizens to better control public programs at the local level.	Weakens states because it can increase regional inequalities, lead to separatism, or undermine national financial governance.
Source: Adapted from ICHRP 2005