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Unit I: Introduction to Decentralization
Centralization
It is a concept that denotes the concentration of authority in a particular position. It is making the
works done from the central authority. There is low or no involvement of the local institutions in
the service delivery options. The accountability, responsibility an resources capacity lies on the
central bodies whereas local people are only service receivers. It is applicable to the beginning
phase of any country with less diversity and service demand, no development in local leadership.
Strengths of Centralization:
1. Emphasis on top-down control leadership
2. Decision making strong
3. Organizational change shaped by the vision of the top leader
4. Fast and coordinated action which is able to respond quickly to major issues and changes.
5. Low risks of conflicts
6. Easier to implement uniform policies and practices for the whole country
7. Prevents the other parts of the country to become too much independent hence maintains
national integration
Drawbacks of Centralization:
1. Lack of authority down the hierarchy may reduce the local leaders motivation.
2. Does not maintain public participation
3. Public service misses flexibility and speed of decision making.
4. Does not address the local needs effectively
5. Does not maintain accountability and transparency
6. Service delivery will be slow due to the bureaucratic process
Decentralization
It is the establishment of local bodies outside the regular bureaucratic structure. It is the transfer
of authority and responsibility for public functions from the central government to subordinate or
quasi-independent local bodies or private sector. It refers to the restructuring of authority so that
there is a system of co-responsibility between the institutions of governance at the central, regional
and local levels.
Strengths of Decentralization:
I. Emphasis bottom up approach
II. Decision making will be democratic
III. Increasement in participation and accountability
IV. Decision making will be closer to the public
V. better able to address the local needs effectively
VI. good way of training and developing leaders
VII. organizational change due to the interactions
Drawbacks of the Decentralization:
1. Worsens the service delivery in the absence of effective controls and
oversight
2. deteriorates service quality due to over burden and out of capacity of local
government
3. local elites gain undue advantage by overcoming rules
4. creates new ethnic and religious rivalries
5. may lead to regional imbalances
Difference between Centralization and Decentralization:

Centralisation Decentralisation
 1. It is the concentration of a. It is the dispersion of power, authority and resources
powers,authority and resources to the to the various level of local bodies.
center.

2. It involves systematic consistent of b. It involves dispersal of authority.

authority

3. The communication flow is vertical. c. The communication flow is open and free.

4. It is ideal for small-sized countries. d. It is ideal for large and multi ethnic, multi culture
countries.

5. There is less chance of conflict. e. There is high chance of conflict.

6.The burden of work goes only to the f. The burden of work is shared among many levels.
center.

7.The power of decision lies within the g. The power of decision lies with the multiple levels.
center.

8. It is implemented when there is h. It is implemented when there is considerable country

inadequate control over the country. over the country.

Similarities between Centralisation and Decentralisation:

1. Both are the ways to change the government structure.
2. Both are the ways to transfer decision making power.
3. Both deals with how information is flowing.
4. Both influences the tiers in government.
5. Both influences the span of control of government.
Relationship between Centralisation and Decentralisation
Both centralization and decentralization depends upon the situation and many factors associated
with it. Decentralization is not an alternative to centralization. Both are needed. The
complementary roles of national and sub-national actors should be determined by analyzing the
most effective ways and means of achieving a desired objective.
Forms of Decentralization:
Deconcentration

It is considered to be the weakest form of decetralisation and used in unitary states. It is simply the
transfer of power and functions from the central organization to their respective field level
agencies which morally work for the central government and do not enjoy the autonomy. The
decentralization in the deconcentration form is the decision making discretionary and the lattitute
to the plans of the center. The transfer of authority includes the transfer of authority for specific
decision making, financial and management functions by the same jurisdictional authority of the
central government. It doesnot suffer from the organizational discontinuity. Examples: The power
and functions of CDO in every district.

Delegation
It refers to the transfer of government decision making and administrative authority or
responsibility for completing specified tasks to institutions or organisations that are either under
government indirect control or semi independent. It leads to the formation of semi-autonomous
body. In other words, it is a process of transferring authority or power to one or more persons who
act on behalf of others. It is usually done according to the set of certain rules/legal contract.
Examples: The representative member of Nepal in UNO, SAARC and other various international
platform.

Devolution

It refers to the creating, strengthening and transferring power and functions to the autonomous
lower level such as local units that are legally constituted as separate governance bodies. It
provides opportunities for the effective participation in the local level decision making process. It
helps to promote democracy at the grass root levels so that the local representation might gather
experience to be able tomorrow for the natural level progamming. Through devolution, central
government distributes certain functions or creates new units of government that are outside of its
control. In the devolution, local bodies are elected locally. For eg: Local level or local government.

Similarities between Deconcentration, Devolution and Delegation of powers:

a. Both of them are forms of decentralization.

b. Both of them involves the transfer of power from center to the autonomous or semi-
autonomous body
c. Both of them try to to address the local needs effectively
d. Both of them emphasis bottom-up, political and cultural learning.
Difference between Deconcentration, Delegation of power and Devolution

Deconcentration Delegation of Power Devolution

It is simply the transfer of It refers to the transfer of It refers to the creating,

power and functions from
the central organization
to their respective field
level agencies which
morally work for the
central government and
do not enjoy the
autonomy.
government decision
making and
administrative authority
or responsibility for
completing specified tasks
to institutions or
organisations that are
either under government
indirect control or semi
independent.
strengthening and
transferring power and
functions to the
autonomous lower level
such as local units that
are legally constituted as
separate governance
bodies.

It doesnot lead to the It leads to the formation It leads to the formation

formation of any of semi-autonomous of autonomous bodies.
autonomous bodies. bodies.

It involves very limited or It involves some transfer It involves transfer of

less transfer of authority. of authority. authority,
 The decision making is The decision making is The decision making is
discretionary and latitude mixture of autonomy and fully autonomous.
to the plans of the center. influence from center.

It is most suitable in the It is most suitable in the It is most suitable in the

unitary system. both federal and unitary federal system as
system. provinces or states are
formed according to the
devolution of power.

The formed body is The formed body is The formed body is

appointed by the center. appointed by the center. appointed by the local
people.

It doesnot provide the It doesnot create the same It creates the

effective participation of environment as environment for effective
people. devolution for effective participation.
participation.

Example: Example:District Example: Municipality

Decentralization Act Administration Plan Act 2047, VP Act 2047
2038, Decentralization
Act 1982

Privatization
It is the process of transferring ownership of a business, enterprise, agency, public service or
property from the public sector to the private sector or private non-profit organization. It is to get
the job done through the private organizations. It includes:
a. allowing private enterprises to perform functions that had been previously monopolized by
government
b. contracting out the provision or management of public services to commercial
c. financing public sector through capital market and allowing private organization to participate
d. transferring responsibilities for providing services from the public to the private sector
Benefits:
a. development would be faster
b. innovative solutions
c. effective and time bound solutions
d. cost cutting
e. efficient delivery of many goods or services
Designing Decentralization:
Decentralization is a generic term which includes devolution, deconcnetration, delegation,
privatization, etc. The challenges to be resolved in designing and deciding decentralization
concerns on the many modes of decentralization to be applied. Central government around the
world are decentralizing fiscal, political and administrative responsibilities to lower level
governments and private sector. Many decentralization policies in the world are designed in a mix
of them all.
Challenges in Decentralization:
a. Sizable amount of mutual trust between the people and political as we as technical leadership.
b. Requirement of leadership that trusts people and the people that trust leadership especially in
the local and national levels.
c. Challenge of engineering consensus.
d. Challenges related to capacity
e. Challenges related to finance decentralized governance
Methods for designing decentralization :
a. Conductive political climate.
b. Favorable socio-psyschological attitude.
c. Adapting participatory approach in planning local governance and decentralization program.
d. Clarity of functional jurisdication.
e. Recognisation of autonomous status of LGIs
f. Capacity building of local bodies.
g. Conceptual clarity on local development and people's participation.
h. Political stability an continuity.
Five important conditions for successful decentralization:
1. The decentralization framework must link financing and fiscal authority to the service provision
responsibilities and functions of the local government.
2. The local community must be informed about the cost of services and service delivery options.
3. There must be mechanisms by which the community can express its preferences.
4. There must be a system of accountability.
5. The instruments of decentralization- the legal and institutional framework, the structure of
service delivery responsibilities and the intergovernmental fiscal system are designed to support
the political objectives.
Unit II. State Modernization and Need for decentralization

Nepal as Federal Democratic Republic

Federal : Our country adopted federalism in 2075 BS. Our country is divided into 7 Provinces with
One Federal Government. The agenda of federalism came during People Movement II. Basically,
federal means a country which has adopted federalism and is divided into states or provinces.
After the declaration of Constitution 2075, Nepal was declared as Federal country.
Democratic: Our country got democracy in 2007 BS from the autocratic Rana Regime. After
Democracy, people appointed their leaders and formed Interim Constitution 2007 which declared
Nepal as Democratic Country.

Republic: Our Country became republic in 2063 BS after the last Shah King Gyanendra resigned
from his throne and gave the throne to the people. Later the Interim Constitution of Nepal 2063
BS declared our Country Federal Democratic Republic.

State Restructuring in Nepal

The issue of state restructuring in Nepal came after by the great Nepali people in the people’s
Movement 2006 and its achievements, the Interim Constitution of Nepal 2007 has been
promulgated. According to the article 33(4) of the constitution, it has made provision that there
will be progressive, inclusive and democratic state restructuring to end the existing centralized and
unitary structure of the state including all discriminations based on class, caste, language, gender,
culture, religion and region. So the present state must be restructured for complete overhauling of
the age old cultural, psychological and economic dependence and malaise of Nepalese society and
for establishing institutional development of the democratic republic with appropriate
constitutional and structural arrangements so as people’s sovereign power could be exercised from
grassroots levels(community, village, setttlements).
Features of Old Nepal
• 75 Districts
• 14 Anchal
• 5 Development Regions
• One Government (Nepal Sarkar)
• One Official Language
• One National Dress
• One citizenship
• One bureaucracy
• Hinduism as a state religion
Features of New Nepal
Constitution of Nepal 2075
Nepal as a Federal Democratic Republic
State to be divided into 7 Provinces
Districts to be redefined
Local Units under province government
Three tiers of Government:1 Federal Government,7 Provincial and Local Government (753Local
Units; 6 Metropoliton, 276 Urban Municipalities, 460 Rural Municipality)
More than one provincial state
Federal and provincial bureaucracy
Secular state
Big questions for state restructuring
• What steps to be taken for making people more powerful to restructure the state in a
progressive manner?
• What helps restructure the state mechanism so as to promote general welfare of the
people?
• How can this process be made more participatory and inclusive?
Decentralization and Public Participation:
Participation means active involvement of all stakeholders in the process of development by policy
making, prioritizing issues, accessibility to public goods and services and also allocating resources.
Ways decentralization can increase public participation:
● Capacity building: This includes training volunteers, mentoring and leadership
development.
● Consistently focusing on engagement: Maintaining a focus on citizenship,
community development and promoting social cohesion in a jurisdiction.
● Investing in civic infrastructure and community networks so individuals, groups and
organizations can participate.
● Ensuring community engagement initiatives are diverse and genuine in their desire
to ask and make use of community input.
● Establishing a public policy system to respond to community wishes: Through
delivering specific outcomes and providing ongoing feedback.

Public participation can enhance decentralization by the following ways:

1. Development work will be faster.
2. It promotes social unity.
3. Means and resources are properly utilized.
4. Sustainable development goals are accomplished.
5. People’s wishes are fulfilled.
6. There is less chance of corruption or misuse of budget.
7. Employment opportunities will increase.
8. There will be improvement in living standard.
Decentralization and Gender Equity
Gender equality is defined as the absence of discrimination, on the basis of a person’s sex, in
opportunities and the allocation of resources or benefits or in access to services. The concept of
gender equality has evolved over time: initially, gender equality was concerned with treating
everyone the same. Treating everybody the same, however, perpetuates existing inequalities. By
acknowledging and addressing different needs, interests and values, health services and
professionals can work to overcome these inequalities and arrive at equitable outcomes.
Decentralization can promote gender equality by the following ways:
1. Establishing equal partnership of women and men in the development and community
programs.
2. It helps to break down the gender stereotypes.
3. It helps to inform the women who are the victims of gender inequality.
4. It helps to support legislation that prevents discrimination based on gender.
 5. It helps to generate awareness about the gender equality and gender discrimination in the
society.
Gender equality can promote decentralization by the following ways:
1. It helps to promote democracy by promoting equal opportunities for every gender.
2. It promotes peace.
3. It helps to distribute the resources equally.
Decentralization and Regional Balance:

Regional balance is an important condition for the harmonious and smooth development of a
country. It does not imply equal development of all regions of a country. Rather it indicates
utilisation of development potential of all areas as per its capacity so that the benefit of overall
economic growth is shared by the inhabitants of all the different regions of a country. Thus the
regional balance implies uniform distribution pattern of the planned investment among different
regions of a country. Alternatively, regional balance demands distribution of investment in such a
way so that the regional rates of growth in different parts of the country be equally attained,
eliminating the regional disparities prevailing in the country. Thus to attain regional balance, it is
quite important that the backward regions should try to attain higher rate of growth than that of
developed areas.

Decentralization can promote regional balance by the following ways:

1. It promotes equitable distribution of resources in every parts of the country according to the
area.
2. It channels the voice of every region’s problem.
3. It helps to develop infrastructure for development of every places so that they will be
connected to the mainstream of the development.
4. It helps to fully utilize the resources and labor force of every region.
5. It helps to identify the region that needs serious attention for development and provides
necessary resources and incentives to promote that region.
Regional balance can promote decentralization by the following ways:
1. It helps in reducing disparities, promoting growth, promoting sustainable development,
economic growth of collective region based on its potential.
2. It helps to solve the issue of migration to a great extent.
3. It helps in proper utilization of resources.
4. It helps to control the pollution.
5. It helps to reduce the conflicts and wastages of resources.
6. It brings equity.
7. It acts as connecting link in policy areas.
Poverty and Decentralization:
Poverty is often identified as deprivation in well-being. Not just in terms of to be hungry, the lack
of shelter and clothing, to be sick and not cared for or to be literate, but not schooled, but for poor
people living in poverty is more than this. Poverty makes people vulnerable adverse events outside
their control.
The term poverty refers not only to material deprivation but also to low achievements in education
and health, vulnerability and exposure to risk, and lack of voice and empowerment. All these
elements combine to severely restrict the capability of an individual to escape poverty. It is a
problem that is not only the concern of each state, but also an international security issue as it is
now a fact that the world is suffering a severe poverty threat. 2.8 billion people live on less than $ 2
a day and among them 1.2 billion people live on less than $ 1 a day and 44% of them live in South
Asia. Poverty renders all human rights inoperative.

Decentralization can reduce poverty by the following ways:

1. Develop and implement rapid and sustained economic growth policies and
programs, in areas such as health, education, nutrition and sanitation, allowing the poor
to participate and contribute to the growth.
2. Improve management of water and other natural resources. 
3. Invest in and implement agricultural programs. 
4. Encourage people to engage in trade as a path out of poverty. 
5. Create and improve access to jobs and income and develop entrepreneurial talent.
6. Providing all people with access to basic social services including education, health care,
adequate food, sanitation, shelter and clean water.
7. Progressively developing social protection systems to support those who cannot
support themselves.
8. Empower people living in poverty by involving them in the development and
implementation of plans and programs to reduce and eradicate poverty. Their involvement
ensures that programs reflect those things that are important to them.
9. Remove barriers to equal access to resources and services.
10. Provide access to technology and innovation including internet access and affordable
energy. 
Unit III. Concept of Governance System
Governance:
It came from the Latin verb "gubernare" or more originally from the Greek word "kubarnein"
which means " to steer". Basing on its etymology, it refers to the manner of steering or governing
or directing and controlling group of state or people. It is commonly defined as the exercise of
power or authority by political leaders for well-being of their country's citizens or subjects. It is a
complex process by which some people of the society exercise power and enact and promulgate
public policies which directly affect economic and social development. It is the quality of
relationship maintained by the government to the society.
Unitary and Federal System
Unitary System
It is a system in which a sovereign state is governed by a single entity. The central government is
supreme and the administrative divisions exercise only powers that the central government has
delegated to them. Sub-divisions are created and abolished, and their powers may be broadened
and narrowed by the central government. Unitary system is practices in countries: U.K. , France,
Japan
Advantages of Unitary System:
1) It creates less confusion over the governing process among the average citizen.
2) It can respond quickly to the emergency situations.
3) It is usually cheap to run.
4) It is a smaller form of government.
5) There is less complexity in the legal system of a unitary government.
6) A unitary system of governing can replicate the federal states.
 7) Unitary system helps to create a system of unity.
Disadvantages of Unitary System
1) It can be lacking in infrastructure.
2) It is a structure that can ignore local needs
3) It can encourage an abuse of power.
4) Manipulation quite easily occur in the unitary government.
5) Many unitary states does not allow autonomy.
6) It can also have a slower response in local emergencies.
Federal System
It is a political system where a country is divided into different autonomous states or
provinces. Each state or provinces has a separate government along with its federal
government in the center. The term federalism derives from the Latin word foedus (union,
contract). From the 18th Century onwards, the term ‘federalism’ was used to describe a
specific form of state organisation. States used federalism as an alternative to the unitary
state organisation or a loose union (confederation) between different states
Advantages:
1) Maintain close relationship between the government and its people.
2) Conflict may settle at local level.
3) Maximum use of means and resources.
4) Does not hamper the country even if the central government is dissolved.
5) No need to depend upon the center for everything.
6) Increment of public participation in government activities.
7) Local and ethnic art ,culture and heritages can be well protected.
8) Accelerate development activities.
9) Helps to maintain balanced population distribution.
10) Creates a protection against tyranny
11)Encourages a system of cooperation.
Disadvantages:
1) Unequal distribution of means and resources between the states may cause unequal
development and misunderstanding may cause the conflict among the states.
2) It is more expensive than unitary system.
3) There may be misunderstanding between federal and provincial government regarding the
sharing of power and responsibilities.
4) It can encourage to pass ridiculous laws.
5) It can be structured to benefit only rich.
6) The province may demand different state which may become damage to the national
integrity.
There are two types of Federalism:

I. Coming Together Federalism

II. Holding Together Federalism
Similarities between Coming Together and Holding Together Federalism:

a. Both of them have two tiers of government one at center and one at state or province.
 b. Both of them have written constitution which formally allocates legislative including
fiscal powers to the two orders of government ensuring autonomy for each other.
c. Both of them have a set of procedures and institutions for facilitating or conducting
relations between governments.
d. Both of them are based on the devolution of powers.
e. Both of them share open interaction between the Centers and Province or States.
f. Both of them can have variations in rules and regulations at Central and Provincial or
State levels.
g. Both of them promotes social inclusion and use of local resources.
Difference between Coming together and Holding together federalism

Coming Together Federalism Holding Together Federalism

1. It involves independent states a. It involves the large country

coming together on their own to deciding to divide its power between
form a bigger unit. the constituent states and national
government.

2. In coming together, units try to b. In holding together, there is

increase their security by pooling absence of pooling sovereignity and
sovereignity and retaining identity. retaining identity.

3. In this category, all the c. In this category, central

constituent units usually have equal government tend to be more
power and are strong equal to the powerful than the states and the
central government. units have unequal powers.

4. States can challenge and go d. States cannot challenge and go

against the decision of the center. against the decision of the center.

Eg: USA, Switzerland, Australia Eg: Nepal, India, Spain

Difference between Unitary System and Federal System

Unitary System
1. The powers remained at the
central place and central
government have the authority to
make the decision.
2. It is not as much democratic form
of government due to the decision
making power at central place.
3. It has one government known as
central government.
4. It may or may not have
Federal System
a. Most of the powers are delegated
to the provincial or state
government.
b. It is pure form of democratic
government in which provinces can
enjoy some power regarding
governing and decision making in
their respective regions.
c. It has two governments one at
central place and other at province
or state level.
d. It must have a constitution.
 constitution like England do not
have.
5. Highest court cannot give
judgement or remarks on the law or
bill passed by the parliament.
6. The powers and authorities are
shared among lower levels when
needed.
7. There are the common set of riles
and regulations in the entire
country.
8. There exist only one national tire
of government.
e. In case of disputes between the
institutions in federal government or
any bill passed by parliamentary,
judiciary will interfere.
f. There is hierarchy of power from
federal level to state and local level.
g. There can be variations in rules
and regulations at central and local
level
h. There can be more self governing
territories.

Similarities between Unitary System and Federal System:

1. Both system can be in monarchies and democracies.
2. In both cases, the central government maintains control over key issues.
3. Both system can promote stability and prosperity.
Powers of Federal Government in Nepal according to the Constitution:
1. Relating to defence and military
(a) Protection of national unity and territorial integrity
(b) Relating to national security
2. War and defence
3. Arms and ammunitions factories and production thereof
4. Central Police, Armed Police Force, national intelligence and
investigation, peace, security
5. Central planning, central bank, finance policies, monetary and banking,
monetary policies, foreign grants, aid and loans
6. Foreign and diplomatic affairs, international relations and United Nations
related matters
7. International treaties or agreements, extradition, mutual legal assistance
and international borders, international boundary rivers
8. Telecommunications, allocation of radio frequency, radio, television and
postal matters
9. Customs, excise-duty, value-added tax, corporate income tax, individual
income tax, remuneration tax, passport fee, visa fee, tourism fee, service
charge and fee, penalty
10. Federal civil service, judicial service and other government services
11. Policies relating to conservation and multiple uses of water resources
12. Inland and inter-State electricity transmission lines
13. Central statistics (national and international standards and quality)
14. Central level large electricity, irrigation and other projects
15. Central universities, central level academies, universities standards and regulation, central
libraries
16. Health policies, health services, health standards, quality and monitoring,
national or specialised service providing hospitals, traditional treatment
services and communicable disease control
17. Federal Parliament, Federal Executive, Local Level related affairs, special
structure
18. International trade, exchange, port, quarantine
19. Civil aviation, international airports
20. National transportation policies, management of railways and national
highways
21. Laws relating to the Supreme Court, High Courts, District Courts and
administration of justice
22. Citizenship, passport, visa, immigration
23. Atomic energy, air space and astronomy
24. Intellectual property (including patents, designs, trademarks and
copyrights)
25. Measurement
26. Mines excavation
27. National and international environment management, national parks,
wildlife reserves and wetlands, national forest policies, carbon services
28. Insurance policies, securities, cooperatives regulation
29. Land use policies, human settlement development policies, tourism
policies, environment adaptation
30. Criminal and civil laws making
31. Security printing
32. Social security and poverty alleviation
33. Constitutional Bodies, commissions of national importance
34. Sites of archaeological importance and ancient monuments

35. Any matter not enumerated in the Lists of Federal Powers, State Powers
and Local Level Powers or in the Concurrent List and any matter not
specified in this Constitution and in the Federal laws
List of Powers of State Governments:
1. State police administration and peace and order
2. Operation of banks and financial institutions in accordance with the
policies of Nepal Rastra Bank, cooperative institutions, foreign grants
and assistance with the consent of the Centre
3. Operation of Radio, F.M., television
4. House and land registration fee, motor vehicle tax, entertainment tax,
advertisement tax, tourism, agro-income tax, service charge, fee,
penalty
5. State civil service and other government services
6. State statistics
7. State level electricity, irrigation and water supply services, navigation
8. State universities, higher education, libraries, museums
9. Health services
10. Matters relating to the State Assembly, State Council of Ministers
11. Intra-State trade
12. State highways
13. State bureau of investigation
14. Physical management and other necessary matters of State
governmental offices
15. State Public Service Commission
16. Management of lands, land records
17. Exploration and management of mines

18. Protection and use of languages, scripts, cultures, fine arts and
religions
19. Use of forests and waters and management of environment within the
State
20. Agriculture and livestock development, factories, industrialization,
trade, business, transportation
21. Management of trusts (Guthi
List of Concurrent powers of Federal Government and State Government:

1. Civil and criminal procedure, evidence and oaths (legal recognition, public acts and
records, and judicial proceedings)
2. Supply, distribution, price control, quality and monitoring of essential goods and
services
3. Preventive  detention  for  reasons  connected  with  the  security  of  the country, prison
and detention management, and maintenance of peace  and order
4. Transfer of accused persons, detainees and prisoners from one State to
another State
5. Laws relating to family affairs (marriage, transfer of property, divorce,
persons on the verge of extinction, orphan, adoption, succession and
joint family)
6. Acquisition, requisitioning of property and creation of right in property
7. Contracts, cooperatives, partnership and agency related matters
8. Matters relating to bankruptcy and insolvency
9. Drugs and pesticides
10. Planning, family planning and population management
11. Social security and employment, trade unions, settlement of industrial
disputes, labour rights and disputes related matters
12. Legal   profession,   auditing,   engineering,   medicines,   Ayurvedic
medicines, veterinary, Amchi and other professions
13. State  boundary  river,  waterways,  environment  protection,  biological
diversity
14. Matters related to means of communication
15. Industries and mines and physical infrastructures
16. Casino, lottery
17. Early preparedness for, rescue, relief and rehabilitation from, natural
and man made calamities
18. Tourism, water supply and sanitation
19. Motion pictures, cinema halls and sports
 20. Insurance business operation and management
21. Poverty alleviation and industrialization
22. Scientific  research,  science  and  technology  and  human  resources
development
23. Utilization of forests, mountains, forest conservation areas and waters
stretching in inter-State form
24. Land policies and laws relating thereto
25. Employment and unemployment aid
List of Power of Local Governments:

1. Town police
2. Cooperative institutions
3. Operation of F.M.
4. Local  taxes  (wealth  tax,  house  rent  tax,  land  and  building registration fee, motor
vehicle tax), service charge, fee, tourism fee, advertisement tax, business tax, land tax
(land revenue), penalty, entertainment tax, land revenue collection
5. Management of the Local services
6. Collection of local statistics and records
7. Local level development plans and projects
8. Basic and secondary education
9. Basic health and sanitation

10. Local   market   management,environment   protection   and   bio-diversity

diversity
11. Local roads, rural roads, agro-roads, irrigation
12. Management of Village Assembly, Municipal Assembly, District Assembly, local courts,
mediation and arbitration
Assembly, local courts, mediation and arbitration
13. Local records management
14. Distribution of house and land ownership certificates
15. Agriculture  and  animal  husbandry,  agro-products  management, animal health,
cooperatives
animal health, cooperatives
16. Management of senior citizens, persons with disabilities and the
incapacitated
17. Collection of statistics of the unemployed
18. Management, operation and control of agricultural extension
19. Water supply, small hydropower projects, alternative energy
20. Disaster management
21. Protection of watersheds, wildlife, mines and minerals
22. Protection and development of languages, cultures and fine arts
 
List of Concurrent Powers of Federation, State and Local Level
1. Cooperatives
2. Education, health and newspapers
3. Health
4. Agriculture
5. Services such as electricity, water supply, irrigation
6. Service  fee,  charge,  penalty and royalty from  natural  resources,
7. Forests, wildlife, birds, water uses, environment, ecology and bio-diversity
8. Mines and minerals
9. Disaster management
10. Social security and poverty alleviation
11. Personal events, births, deaths, marriages and statistics
12. Archaeology,  ancient monuments and museums
13. Landless squatters management
14. Royalty from natural resources
15. Motor vehicle permits
 

Local Governance:
Introduction:
It is the process of transferring functions, responsibilities, resources and authorities from central
to the local government. It is a more or less polycentric system in which a variety of actors are
engaged in local public decision making process. It is a process of inclusive decision making where
local governments and other relevant actors participate in decision making to agree and
implement essential tasks and basic services that affect the daily life. It is a process by which
authority, power, resources and accountability are transferred from central to local levels. It came
into fashion in the middle of 1990s.
Basic Elements of the Local Governance:
a. Participation
b. Equity
c. Transparency.
d. Accountability
e. Rule of law
f. Legitimacy
Main Actors of Local Governance:
a. State (Executive, Legislative and Judiciary ) creates the conductive political and legal
environment.
b. Local Government provides institutional and administrative framework for conducting
community affairs.
c. Private Sector provides the foundation for economic growth and development.
d. Civil Society facilitate social and political interaction.
Importance of Local Governance:
1. It protects the local interest concerning the livelihood of the community.
2. It promote good governance and build partnership with Civil Society, Private Sector and
Government units of the local level.
3. It helps to express the will of the local people.
4. It helps in developing local leadership.
5. It helps to enhance local techniques.
6. It helps to protect local culture.
7. It helps to utilize local resources.
Local Governance during COVID-19

Many local bodies were active during this crisis. The leaders of local government sealed their own
local area after they were hit by COVID-19. Some leader were engaged in distributing relief.
During this crisis, when Federal Government of Nepal is facing criticism from every sector of the
society, local bodies has helped the people. Some locally elected official took responsibilities of
migrant workers to send them home. Some officials were engaged in making quarantine.

Global Governance

Global Governance is a purposeful order that emerges from institutions, processes, norms, formal
agreements, and informal mechanisms that regulate action for a common good. Global governance
encompasses activity at the international, transnational, and regional levels, and refers to activities
in the public and private sectors that transcend national boundaries. In this conception of global
governance, cooperative action is based on rights and rules that are enforced through a
combination of financial and moral incentives. Methods of global governance
include harmonization of laws among states, international regimes, global policy issue networks,
and hybrid institutions that combine functions of state agencies and private sector organizations.
In its current conception, global governance implies democratic governance.

Principle of Global Governance:

1. Common but differentiate responsibilities and respective capacity.

2. Subsidiarity
3. Inclusiveness, transparency and accountability
4. Coherence
5. Responsible Soveriegnity
Importance of Global Governance:

1. Creating an international rule of law

Global governance can provide a ‘rule of law’ (whether formally codified or not) at the
international level, which can protect the weak from the strong and provide a stable basis for the
development of international institutions. The international ‘rule of law’ is particularly important
for weak states without the material capability to assert their interests.
2. Regulating the global economy and providing global public goods
 It has focused attention on global public goods which are valuable, but not delivered by the
international free market. The market may completely fail to provide the global public good of
polio eradication but international institutions (governmental and non-governmental) are getting
close to achieving this goal.
3. Redistribution at the international level
International inequality (of wealth, income and life chances) remains extremely high. At the
domestic level, many states attempt some kind of redistribution from rich to poor, whether
through advanced systems of tax and benefits or by simply providing free or subsidized basic
services (e.g. primary education) to the poor.
4. When states fail: a safety net for the most vulnerable
The international community often steps in, in one form or another, in cases of catastrophic state
failure. This is the driving idea behind the ‘Responsibility to Protect’ which asserts that the
international community has responsibilities to secure individuals’ human rights when their state
is actively or negligently depriving them of these rights. The same principle animates much
humanitarian relief, international refugee conventions etc. Poor people are often the most
vulnerable in this kind of circumstance, so this role of the international community is particularly
important for them.
5. Changing the state from the outside
There are several ways in which the international system can potentially create change within
states. First, international institutions can be a source of information and expertise – encouraging
states to change their policies or institutions via demonstration effects and ‘peer pressure’. Second,
international institutions can use international resources to ‘incentivise’ (or coerce) change in
countries which need them. This is the model employed by World Bank and IMF conditionality.
6. Accountability: any voice for the poor in global governance
At the global level, this is particularly relevant to poor people, who are arguably much more
affected by the international system than rich people. The World Bank, for example, is irrelevant to
the lives of people in the developed world, but has a huge impact on people in developing
countries, and yet poor people and their governments are less well represented in the institution
than rich people and their governments.

Global governance in COVID-19:

After COVID-19 hit the world, many global governance institutions like WHO, UN, OECD, EU,
etc became aware. They started the guidelines to fight against the COVID-19, some countries
like Taiwan, India shared their vaccines, masks with other countries, some provided economic
assistance to those countries who are badly hit with the COVID-19. In this time of COVID-19,
we can see the work of global governance institutions.

Self-Reliance Local Government/ Self-Reliance Development:

Introduction:
It is defined by independence. It is the ability to think and act without the help or influence of
others. It is the ability to decide what you should be or do. It is linked with the community
development and related to the terminologies like self-help, mutual help, indigenous participation
and rural development. It encourages the need of improving living conditions of people by using
home initiatives and resources. It is considered as the new blue print of community development.
It relies on internal resources as opposed to those developments that relies heavily on external
resources but it should not be considered as autarky as it allows external support. Poor and
disadvantage people find extremely difficult to improve their living without outside help in such a
condition, external help or support can serve as a catalyst or provide the push for action against
poverty or improve standard and even to sustain improvement conditions.
Principles of Self-Reliance Development:
1. The outsider must make a positive difference in the living conditions of the doer ( i.e.
helped ) which means the impact of the helper must be seen as felt.
2. The doer ( the helped ) must own and implement the program or plan the assistance.
3. The outsider must see the world through the eyes of the doer and respect the autonomy of
the doer.
4. The help or support must not undercut the autonomy of the doer.
5. The help must be for a limited period of time.
Vital Elements for Self-Reliance Development:
1. Sufficient and Sustainable resources
2. Capacity building of local actors
3. Empowerment of general people
4. Institutionalization of democratic system
5. Promotion of rule of law
6. Bottom-up planning, monitoring and evaluation
7. Political will, honesty and stability.

Globalization vs Localization
Globalization: It can be defined as the growing interdependence between all people of the
world. The increasing interdependence and interconnectedness of places globally. It is cross
border integration of economic, social and cultural activities.
Localization: It is a process and vision of local development through the use of local resources
and technology. It prioritize the local issues and resources than the international, regional and
national issues. Decentralization is the foundation of localization: mainly through devolution
and representation. The main objective of localization is to protecting and developing local
knowledge, skill and technology. It is both protection and promotion of local uniqueness.
Localization is a concept based on self-reliant local development.

Globalization Localization

1. It is all about spreading without any a.It can be seen as counterpart of

boundaries and promotes the free globalization and promotes local
movement of goods and services product and culture.
between communities or countries.

2. It is global. b. It is local.

3. There is international There is local

collaboration,alliances,exchange and involvement,colloaboration and
competition. support.

4. There is international brand d. There is local brand recognition

awareness.

Too much of globalization can bring problems like discouragement in the production of local
goods, interference of global markets in the economy, pressure of global competition to the
local farmers and so on. Whereas, too much localization can cause problems like: limitations of
 local goods only in the local market, lack of marketing of local goods in the international
market and so on.
1. Globalization and localization are not an alternative and competitor of each other. And, in
fact, they should complement each other by considering these points:
2. Human development
3. Regional balance
4. Equity and equality
5. Poverty alleviation
6. Protection and promotion of environment
7. Appropriate management of population
8. Utilization and promotion of local knowledge and skills
9. Social justice
10. Proper and effective utilization of natural resources.
11. Social integration

Federalism in Nepal:
Nepal is the 27th federal country. There is one Federal government and other 7 provincial
government.
The Constitution of Nepal 2072 (promulgated on 20 September 2015 and revised later) guaranteed
federalism Preamble,
– Part-5: Structure of State and Distribution of State Power
– Part -26 National Natural Resources and Fiscal Commission (article 250)
– Part -27: Other Commissions (article 252: National Women Commission; Article 255: National
Dalit Commission; Article 258: National Inclusion Commission; Article 261: Indigenous
Nationalities Commission; Article 262: Madhesi Commission; Article 263: Tharu Commission;
Article 264: Muslim Commission)
Criteria or basis used by the CA to federalise country
1. Identity
– ethnicity/community,
– language,
– culture, and
– historical continuity
2. Capability
– economic inter-dependence,
– economic capability,
– status of infrastructures and their viability,
– availability of natural resources and
– administrative accessibility.
Issue of Federalism in Nepal:
Sharing fiscal power and resources
This is one of the main potential areas of conflict in a federal state. If appropriate mechanisms for
the distribution of fiscal power are absent, it can create conflict later. Federal countries like
Australia, Spain, Malaysia and Germany are relatively centralised in their distribution of fiscal
powers (i.e., the central government has the main power to collect tax and other revenues),
compared to Switzerland, Brazil and Canada (which leaves the right to raise revenue mainly in the
hands of the federal units). If revenue means and expenditure needs for the various federal units
are mismatched, it can lead to tension and dysfunction. Anwar Shah argues: Vertical fiscal gaps
and revenue autonomy at sub-national orders of government remain areas of concern in federal
countries where the centralisation of taxation powers is greater than necessary to meet federal
expenditures, inclusive of its spending power. This leads to undue central influence and political
control over sub-national policies, and can even undermine bottom up accountability. This is a
concern at the state level in Australia, Germany, India, Mexico, Canada, Malaysia, Nigeria, Russia,
Spain and South Africa5. Hence, clearly defining fiscal relations, tax assignment and tax-based
revenue sharing mechanisms is crucial. Once the central government starts developing direct
relations with local government, the relevance of the federal units in terms of economic issues may
also be in question, despite their intact constitutional or political roles (like in Brazil, USA or
Canada).
Protection of minorities, marginalised and excluded groups
One of the major causes of the armed conflict in Nepal was the exploitation, discrimination,
marginalisation and social exclusion of certain communities/groups. The demand for a federal
governing system is largely to address this problem. If the new federal governing system protects
minorities, marginalised and excluded groups, then the possibility of conflict and tension related
to these issues will be reduced. Hence, the federal system adopted by Nepal must protect of rights
of individuals and groups. For every decision that the CA makes on the federal system the question
will have to be asked: what implications will it have for individuals, for Nepal, and for
communities/groups. What additional protective mechanisms are needed to really address these
concerns?
Jurisdictional clarity
Experiences of different federal countries (such as Australia) demonstrate that jurisdictional
tensions and conflicts are common when there is no clear definition of jurisdiction (distribution of
powers) between the national and sub-national governing units. To avoid such problems, the
constitution must clearly delineate between the jurisdictions of the various constitutional bodies,
as well as of the different states, the states and the centre, and the states and local governing units.
Dispute resolution mechanisms must also be in place to deal with any ambiguities
Social divergence
Language, race, religion, social structures and cultural traditions in a federal system must be
mutually and simultaneously reinforcing. If some factors or actors negatively highlight cleavages
associated with these structures, social divisions mount and cause tension and conflict within and
between federal units. In a multicultural federation like Nepal it is important to officially recognise
the languages of the main minority groups. Nepal needs to learn from the intensity of language
related resentment in Pakistan, Malaysia, India and Nigeria. At the same time, however,
institutional arrangements must be flexible enough to allow for a needs-based adjustment. The
experiences of Sudan, Sri Lanka and Spain show that political polarisation based on social
divergence can lead to separatist movements and that state reactions and counter-reactions can
make these demands stronger. There is a sad pattern of conflict escalation: Groups normally start
by asking for non-discrimination and political representation. If this is not fulfilled, they demand
self-rule. If, again, this demand is not fulfilled, then demands for federalism are voiced. If, again,
concerns are not addressed, as a next step, demands for independence may arise. Hence, it is
crucial that the governments of the federal units and the centre address these issues at the outset.
Institutional Arrangements
The nature, types and mandates of the institutional structures of federalism determine their degree
and ability to address differences, conflict and tension within the federation. How the institutions
accomplish tasks related to the electorate, bureaucracies, political parties, business sector and civil
society, and how they deal with political conflict determine whether or not conflicts that emerge
from social divergences and cleavages are resolved or escalate. Hence, the ability of institutions
and the design of processes to generate cooperative approaches to bring about consensus is crucial
to minimise conflict and promote selfrule and shared rule. Ensuring that the issues, concerns and
voices of the people within the federal units are accommodated in decisions and that all concerned
groups are represented in the legislature, civil service, executive and political party structures is
also important. If certain groups are not adequately represented in the institutions of the federal
units and central they feel alienated and may start separatist activities, as observed in East
Pakistan, which separated from Pakistan in 1971 to become Bangladesh. The experiences of India
and Nigeria demonstrate that if there are extreme differences between the federal units in terms of
wealth and the size of the population this can create tension and stress and led to demands for the
reorganisation of the boundaries of the federal units. If one federal unit dominates
demographically or economically, tension and conflict between federal units is unavoidable.
The naming process of the provinces and the question of where their headquarters should be
located has been an unsettled issue for some of the provinces.
There is very limited interactions between the social, behavioral and civil participation aspects of
federalism.
Legal challenges: for instance, the formulation of laws and policies without curtailing citizen’s
rights and lessening the contradictions and confusion around the formulations of laws and policies
on all government levels.
The implementation of Federal system is considered to be costly as Nepal is supposed to set up a
new Administrative as well as physical structure.
Tax burden and tax duplication is potential problem in which local governments and the federal
states may decide on different tax rates between the local municipalities and states and between
commodities and services within states.
In Nepal, all of the 25 political parties represented in the CA, except for one (Rastriya
Janamorcha), have accepted the federal political system. Only, Rastriya Janamorcha vehemently
opposes federalism. Their concerns and arguments are that federalism:
• Weakens sovereignty and increases the risk of disintegration of the nation
• Promotes communal disharmony and conflict
• When states are based on ethnicity, promotes hatred against each other
• Erodes national feeling and weakens national identity, while strengthening ethnic and
communal identity
• Is not the Nepali people's agenda, but is coming from the vested interests of India to keep Nepal
weak and instable
• Leads to the breakdown of national political parties into regional ones, which causes related
tensions
• Leads to discrimination of people within the nation as the rules of different states vary
• Results in ineffective delivery of government services
• Is operationally expensive, not sustainable for Nepal
• Brings unanticipated consequences and problems Some intellectuals argue that federalism is
mainly suitable for unifying separate small states, but is not appropriate to separate a unified state.
On the political front, Rastriya Janamorcha argues that federalism was introduced by a few elite
politicians under external influence who wrongly equated a centralised state with a unitary state.
They believe that decentralisation would have been sufficient to address concerns that other
politicians want to address through federalism. The opposition of Rastriya Janamorcha to
federalism has provided ample inputs for decision makers to ponder the challenges involved in
implementing federalism and the measures that need to be taken to address the concerns raised by
Rastriya Janamorcha. Proper debate on the benefits and limits of federalism can help to avoid
deficiencies in design and implementation.
Solutions for the issues and challenges regarding Federalism:
 A critical review and reflection among stakeholders is necessary regarding the performance
of the federal structure. Such reviews should especially focus on responding to critical
questions such as what the new federal structure could deliver within a one year and a five
year time frame and how the roles and responsibilities of different actor should look like.
 Expectation management in the context of the transitional governance structure is crucial.
High expectations of people and leader’s promises to meet those expectations have made it
difficult to establish the new system and find supporters. An honest and trustworthy
communication in the form of white paper statement, public hearings or media conferences
can play an important role to manage people’s expectations.
 Political, economic, psychological and behavioral preparadeness is important to move from
an old to a new governance system. Since, Nepal had a unitary governance system for many
years leaders, citizens and bureaucrats are accustomed with the culture and practices of the
former system. Shifting towards the federal system requires the simultaneous federalisation
of mindsets, polices and implementation process.
 Adequate knowledge and capacity development opportunities for elected local and
provincial government leaders and bureaucrats are of importance. Issues that should be
tackled to increase the effectiveness of the new system are development planning, fiscal
management, resource mobilization and evaluation of projects and programs.
 Addressing the needs and concerns of socially deprived people should be another key focus
of the new federal structure.
 Adequate provisions to create a wider civic space where citizens, institutions, opposition
parties and others can express their concerns through non-violent approaches should be
taken.

Unit IV. Good Governance

Good Governance:
It is a subset of governance wherein public resources and problems are managed effectively and
in response to critical needs of the society. It is a term which used to encompass/ describe: full
respect of effective participation, human rights, rule of law, multi actor partnerships,
accountable processes, pluralism, transparent and institutions, an efficient and effective public
sector, legitimacy, access to knowledge, information and education. It refers to the public
administration process that maximizes the public interests.

The World Bank defines governance as ‘how power is exercised in the management of a

country’s economic and social resources for development.’ According to a document released by
the World Bank in 1992 titled, ‘Governance and Development’, good governance is an essential
complement to sound economic policies and is central to creating and sustaining an environment
which fosters strong and equitable development.

Components of Good Governance (according to the World Bank):

o Capacity and efficiency in public sector management

o Accountability
o Legal framework for the development
 o Information and transparency

Because of the close link between corruption and poor governance, many international
organisations such as the World Bank and the International Monetary Fund (IMF) are
preconditioning their aid to countries on the guarantee that the recipient countries
undertake good governance practices.

The United Nations Development Programme (UNDP) has defined governance as ‘the rules

of the political system to solve conflicts between actors and adopt decision (legality).’

The definition given by the Commission on Global Governance (1995) describes

governance as ‘the sum of the many ways individuals and institutions, public and private,
manage their common affairs. It is a continuing process through which conflicting or
diverse interests may be accommodated and cooperative action may be taken. It includes
formal institutions and regimes empowered to enforce compliance, as well as informal
arrangements that people and institutions either have agreed to or perceive to be in their
interest.’

4Es- Pillars of Good Governance

 Ethos (of service to the citizen)

 Ethics (honesty, integrity and transparency)

 Equity (treating all citizens alike with empathy for the weaker sections)

 Efficiency (speedy and effective delivery of service without harassment and using ICT

increasingly)

Citizens are thus at the core of good governance. Therefore, good governance and citizen centric
administration are inextricably linked.

Necessary Pre-Conditions For Good Governance

A study of the hindrances to good governance shows that many preconditions must be satisfied to
make governance citizen-centric. A few of the preconditions are given below:

 Effective legal framework

 Sound and effective institutional mechanism for correct implementation of laws
 Competent employees manning these institutions and efficient personnel management
policies
 Apt policies for delegation, decentralization and fixing accountability.
Also, several tools can also be used to make the citizen-centric administration. These are listed
below:

 Re-engineering processes
 Adopting correct modern technology
  Right to information
 Citizens’ charters
 Independent services’ evaluation
 Grievance redressal mechanisms (Read the components of redressal mechanism in the
linked article.)
 Active citizens’ participation – public-private partnerships

Importance of Good Governance:

1. It conducts and manage public affairs and resources to guarantee human rights.
2. It maintains public participation, accountability and transparency
3. It makes the government work effectively and legitimate in administrative system.
4. It promotes and sustains holistic human development.
Elements or Characteristics of the Good Governance:
1. Participation
Participation means active involvement of all stakeholders in the process of
development by policy making, prioritizing issues, accessibility to public goods and
services and also allocating resources. It is the political dimension of the good
governance. Good Governance requires the participation of all men and women
including physical challenged one. Traditionally, the participation was recognized as the
"top-down approach" which refers to the government monopoly in both responsibilities
and power. But today, the government works in hand with other sectors of the society
and considers them the partners of government in attaining different goals which is
knows as "horizontal system" or " bottom-up approach". From human rights stand,
people have the rights to participate in decisions that affect them and also seek justice if
they are denied of these rights.
2. Rule of Law
It means that everybody in the system is equal before the law and the law is
implemented in impartial manner. It is an essential ingredient of Good Governance and
cornerstone of democracy. Good Governance requires fair legal framework that are
enforced impartially and protects human rights. Through the rule of law people express
their will and exercise their sovergnity. It sees that the operating and functioning
environment of the society must be based on objectives laws and there must not be any
fancies of anyone who is powerful or influential. The rule of law demands the following
things:
a. People and civil society renders habitual obedience to the rule of law.
b. Government acts within the functions and powers prescribed by the law.
c. Laws are responsive to the needs of the society.
The absence of rule of law is anarchy and it happened when people act in disregard of
the law or the government acts beyond their powers. The strengthening of rule of law
sees reforms in enforcement agencies. In conclusion, rule of law means "peace and
order", "absence of corruption","impartial and effective judiciary system", "observance
and protection of human rights" and "clear,publicized and stable laws".
3. Equity and Inclusiveness
Equity means everyone is equal and has equal opportunity in a community disregard of
his or her cast, gender, color, race, religion or faith and social status. Inclusiveness
means consideration of interests, aspirations and opinions of all individuals and groups
living in a society while formulating plans and policies meant for the society. Equity and
inclusiveness are the bases of the human rights standard of a society and essence of
social justice as a fundamental principle of governance within a human community. A
society's well being depends on ensuring that all its members feel that they have
partnership in it and do not feel excluded from the mainstream of the society. It is based
on the principle that who have less in life should have more in laws.
4. Transparency
It means that processes, institutions and information are directly accessible to all the
people of the society. It is built on the free flow of information. It promotes the openness
of government action, decision making processes and consultative processes among
public sector and all stakeholders. It can be strengthened through the citizen's right to
information with a degree of legal enforceability. As an indicator of the good governance,
it means people are open to information regarding decision making process and the
implementation of the same. Lack of transparency in the society creates environment for
corruption which is harmful to the progress and welfare of the society.
5. Responsiveness
It means that the requests and requirements of the people are addressed in the punctual
manner. A deliberative unnecessary delay by the service providers in performing their
duties towards the people must be avoided at any cost. It must be ensured that service
delivery system must have a provision of the time and period clause to accomplish their
duties within a predictable time.
6. Consensus and Legitimacy
Consensus usually means collaboration rather than compromise. To secure the peace
and harmony there must be the consensus among the various stakeholders, hence, the
governance structure and functioning obtains legitimacy from whole community. To
meet the consensus, a strong, impartial and flexible meditation structure must be
established. Instead of one opinion being adopted by a plurality, stakeholders are
brought together until a convergent decision is developed. Consensus decision making is
a process that not only seeks an agreement of most participants but also mitigates the
objectives of the minority to achieve the most agreeable decision. Public hearings or
consultations in arriving at a consensus are necessary in the process of governance.
7. Effectiveness and Efficiency
It is the technical aspect of the good governance. The concept of efficiency in the good
governance covers the sustainable use of natural resources and the protection of the
environment. Good governance requires that the institutions, processes and actors could
deliver and meet the necessities of the society in a way that available resources are
utilized efficiently and effectively. Efficiency and effectiveness of resources must go
necessarily together to ensure the best possible results for the community. To achieve
effectiveness and efficiency, good governance principles prescribe a competitive
economic environment, capacity building of the institutions and required training to the
personnel.
8. Accountability
It means that decision makers in the government sector are answerable to the public as
well as to the institutional stakeholders for their action or lapses. It also means
answerability or responsibility for one's action.
Principle of Accountability:
a. Every person or group is responsible for their action most especially when their acts
affect public interests.
b. Information sharing and transparency must be promoted by government structures.
 Barriers to Good Governance:

Lack of Accountability

1. A common reason usually cited for inefficiency in governance is the inability within the
system to hold the Civil Services accountable for their actions.
2. Seldom are disciplinary proceedings initiated against delinquent government servants and
imposition of penalties is even rarer.
3. It is primarily because at most levels authority is divorced from accountability leading to a
system of realistic and plausible alibis.
4. Cumbersome disciplinary procedures have added to the general apathy towards discipline
in Government. Moreover, the safeguards provided to civil servants, – which were well-
intentioned – have often been misused.
5. Another reason for the lack of accountability is that performance evaluation systems within
the government have not been effectively structured.
6. The complacency that the system breeds have resulted in employees adopting an apathetic
or lackadaisical attitude towards citizens and their grievances.

Low Levels of Awareness of the Rights and Duties of Citizens

1. Inadequate awareness about their rights prevents citizens from holding erring government
servants to account.
2. Similarly, low levels of compliance of Rules by the citizens also act as an impediment to
good governance; When citizens do not adhere to their duties they infringe on the freedom
and rights of other citizens. Thus, awareness of rights and adherence to duties are two sides
of the same coin.
 3. A vigilant citizenry, fully aware of its rights as well its duties, is perhaps the best way to
ensure that officials as well as other citizens, discharge their duties effectively and honestly.

Weak Civil Society

1. Good governance is badly affected by weak civil society institutions.

2. Civil society bridges the gap between the governed and the government. It checks the
growth of unethical practices.
3. But, when the Civil Society institutions are weakened or they are absent the gap between
people and the government gets widened.

Ineffective Implementation of Laws and Rules

1. There is a large body of laws in the country, each legislated with different objectives –
maintaining public order and safety, maintaining sanitation and hygiene, protecting rights
of citizens, giving special protection to the vulnerable sections etc.
2. Effective implementation of these laws creates an environment that would improve the
welfare of all citizens and at the same time, encourage each citizen to contribute his best
towards the development of society.
3. On the other hand, weak implementation can cause a great deal of hardship to citizens and
even erode the faith of the citizenry in the government machinery.

Red Tapism

1. Bureaucracies the world over are expected to adhere to rules and procedures which are, of
course, important for good governance. However, at times, these rules and procedures are
ab-initio ill-conceived and cumbersome and, therefore, do not serve their purpose.
2. Also, government servants sometimes become overly preoccupied with rules and
procedures and view these as an end in themselves. Prime Minister Dr. Manmohan Singh
while emphasizing procedural reforms, stated:

Lack of strong institutions of governance

1. Governance functions with the Governance. Overview support of various institutions such
as the legislature, executive, and the judiciary, with a clear separation of power.
2. If these institutions succumb to illegal and unethical pressures, and they fail to perform
their designated functions, then the institutions get weakened.
3. This results in the failure of the process of governance and hampers development
initiatives.

Role of Various Stakeholders in Good Governance

a. Role of Government in the Good Governance:
1. Maintain rule of law
2. Capital formulation, fiscal policy, foreign policy
3. National defense
4. Investigating in social services and infrastructure
5. Protecting the vulnerable
6. Policies reducing regional disparity and maintaining national integrity
7. Maintaining accountability and transparency
8.Being consensus and legitimate
Role of Local Government Staff
1. Being responsible for council revenue collection and expenditure according to the approved
budget.
2. Maintain political and public relations with councillors and other external stakeholders.
3. Implementation of council business through council and committee meetings.
4. Being responsible for policy formulation, co-ordination and accountability, and legal
matters.
5. Formulating, coordinating and supervising implementation of plans for economic, social
and industrial development in their areas of jurisdiction.
6. Monitoring and controlling the performance of duties and functions of the council and its
staff.
7. Ensuring collection and the proper utilization of revenues of the council.
8. Making by-laws applicable throughout their areas of jurisdiction, and considering and
improving by-laws made by village councils within their areas of jurisdiction.
9. Ensuring regulating and coordinating development plans, projects and programmes of
villages and township authorities within their areas of jurisdiction.
10. Regulating and monitoring the collection and utilization of revenue of village and township
authorities.
11. Subject to the laws in force, doing all such acts and things as may be done by a people’s
government.
b.Role of Civil Society in Good Governance
Civil society can be defined as the voluntary organizations that are neither the part of the
government, business nor family and performs the function like delivering services or trying to
influence the development policies. It includes: NGOs, INGOs, Cooperatives, Registered and
unregistered savings and credit organizations, community user groups and community based
organizations.
Features of Civil Society:

 Autonomous
 Democratic Governance structure
 Voluntary membership base
 Non profit status
 Focus on specific issues, functions or activities
Function of Civil society in Good Governance
a) Mobilize human energy and creativity to address specific interests, serve community
needs, undertake collective action and provide a common voice
b) Provide organized means of dialogue and services
c) Raise awareness
d) Receive and deliver services
e) Undertake development actions
f) Identify needs and provide feedbacks on policies
g) Strengthen democracy and provide new forms of interest and solidarity
h) Promote public participation develop democratic values like tolerance
i) "Watchdog" of holding governments and institutions to account
 c. Role of Media in Good Governance
Medias are the communication outlets or tools used to store and deliver information or data.
The word "media" is derived from the word medium showing mode or carrier. It is the sword
arm and fourth pillar of democracy.
Role of Media in Good Governance:
i. It acts as watchdog to protect public interest against malpractice and create awareness.
ii. It inform people about the things that are happening.
iii. It helps to get justice for a lot of cases
iv. It holds the government accountable on the behalf of the people
v. It present the opinion of the people
vi. It promote efficiency, effectiveness and integrity.
d. Role of I/NGO in Good Governance
They are the non-profit entities independent of government influences.
Role of NGO:
I. It can acquire land, construct housing, provide infrastructure and operate and maintain
infrastructure such as wells or public toilets.
II. It supports innovation, demonstration and pilot projects.
III. It facilitates communication between government and people.
IV. It provides technical assistance and training.
V. It research, monitors and evaluates the projects.
VI. It advocates for the poor.
Self-Help Group(SHG)
Introduction:
It is a popular concept. It is almost two decade old. It help to increase economic development of
a country. It is now evolved as a movement.
Principle: It is based on the : group approach, mutual trust of small and manageable group,
spirit of thrift, peer group pressure in re-payment, skill training, capacity building and
empowerment
Characteristics:
1. It is a voluntary association.
2. It has a member of 15-20 people.
3. It has a collective goal.
4. It has a feeling of mutual help/ mutual support.
5. It is informal group.
6. It addresses the group's common problems.
Role of SHG
1) Most of its members are women as a result participation of women in the country's
development is increasing.
2) It helps to elevate the economic status of member families.
3) It helps to boost in women empowerment.
4) It can serve many different purposes depending on the situation and the need.
Ways to Promote Accountability/ Ways to facilitate Accountability:
For maintaining accountability following are the key elements that need to be considered:
1. Enforcing or strengthening of all laws, rules and regulations at local level.
2. Formulation and enforcement of code of conduct for various factors in local levels.
3. Enforcement of wider dissemination of information on local governance taking feedback
from the citizen.
4. Opening up suggestion box or complaint box to collect public governance and timely
redressal of them.
5. Ensuring timely public audit, social audit and public hearing.
6. Enforcing citizen charter and transparency of provisions.
7. Improving community participation in various level of governance
8. Developing capacity of citizens especially of marginalized and vulnerables and women.
9. Effective monitoring and evaluation system.
10. All decisions including the cost of concessions should be informed to people or posted in
internet.
Unit V. Good Governance and Decentralization
Deliberative Democracy
Introduction:
It is a thought in the political theory which claims that political decision should be the product
of the fair and reasonable discussions among the citizens. It is all about placing the people
closer to the affairs of government and decision making. It is a form of democracy in which
deliberation is central to decision making. It adopts the elements of both consensus decision
making and majority rule. Rather than thinking of political decisions as the aggregate of the
citizen's preferences, it claims that citizen should arrive at political decisions through reason
and the collection of competing arguments and viewpoints.
Strengths:
1) It is more easily able to incorporate scientific opinion and base policy on outputs of
ongoing research.
2) It tend to generate the ideal conditions of impartiality, rationality and knowledge of the
relevant facts.
3) It allows participants to deduce what is morally correct.
4) It tend to produce outcome which is better than other forms of democracy.
5) The debates arising from deliberative democracy are much more civil, collaborative and
evidence based than the other debates.
Inclusive Democracy:
Introduction:
It means participation of all the citizen in the policy formulation to bring all citizen of
country in the main stream of the politics. It is a form of social organization which re-
integrate society with economy, polity and nature. It is derived from a synthesis of two
major historical traditions- Classical Democratic and Socialist.
Elements of Inclusive Democracy:
There is four constituent element of inclusive democracy-political, democracy, economic
and ecological. The first three elements aims at the equal distribution of political, economic,
and social power.
Inclusive Democracy tools:
 1) Participation a with control
2) Empowerment and Capacity Development
3) Proportional Representation
4) Reservation, Social protection, subsidies
5) Legal protection
6) Awareness program
7) Empower to weaker
8) Opportunity to excluded
9) Investment in Human Development and poverty alleviation

Role of Constitutional Bodies to promote Good Governance:

Constitutional bodies refer to those institutions that are created by the Constitution itself. They are
different from statutory bodies which are created by a law or statute. The Constitution of Nepal
2015 provides for several constitutional bodies and commissions which have their own value and
importance. Constitutional Bodies in Nepal are mentioned below:

a. Commission for the Investigation of Abuse of Authority (CIAA)

b. Office of the Attorney General
c. Office of the Auditor
d. Election Commission
e. National Human Rights Commission
f. National Natural Resources and Fiscal Commission
Role of CIAA to maintain Good Governance

Transparency and Accountability is one of the characteristics of the Good Governance. A

nation cannot enjoy if there is corruption and the government officials are not accountable to
the people. In this case, the role of CIAA becomes very important. Constitution of Nepal has
empowered CIAA to investigate and probe cases against the persons holding any public office
and their associates who are indulged in the abuse of authority by way of corruption. As a
constitutional body, the authority vested on CIAA are as per the Article 238 and 239 of
the Constitution of Nepal. CIAA not only investigate cases but it also file case against any
government officials who has been involved in corruption. The main aim of CIAA is to conduct
inquiries and investigations of improper conduct of authority by person holding any office
except Nepal Army.

Role of Office of the Auditor General to maintain Good Governance

Transparency, Efficiency and Effectiveness is one of the characteristics of the Good Governance.
Every government offices makes expenditure. Some of the offices make unusual expenditures
which are not according to the law and the main aim of the Auditor General is to audit and find out
these expenditures. Office of the Auditor General (OAGN) is a constitutional body and the
supreme audit institution of Nepal. It derives its mandate from Article 241 of the Constitution of
Nepal and Audit Act, 2075 (2019 A.D.). The Auditor General is empowered to undertake audits of
Office of the President and Vice-President, Supreme Court, Federal Parliament, Provincial
Assemblies, Provincial Governments, Constitutional bodies or their offices, courts, the Office of the
Attorney General and the Nepal Army, Nepal Police and Armed Police as well as of all other
government offices and courts with due consideration given to the regularity, economy, efficiency,
effectiveness and the propriety of government expenditures.
Role of National Human Rights Commission in Good Governance
 Inclusion, Participation and Equity is one of the characteristics of the good governance. A nation
cannot achieve good governance when its citizens are treated unequally and are discriminated on
the basis of gender, caste and other factors and the Human Rights of the citizens are
compromised. In this case , NHRC plays as watchmen to guard the rights of the citizens.
The National Human Rights Commission (NHRC) of Nepal is an independent and
autonomous constitutional body. It was established in the year 2000 as a statutory body under the
Human Rights Commission Act 1997 (2053 BS). The Interim Constitution of Nepal 2007 (2063
BS) made the NHRC a constitutional body. It has a separate sphere of responsibilities in the
constitutional legal system of the country. These responsibilities complement the responsibilities
of the normal machinery of the administration of Justice, the Supreme Court, the Office of the
Attorney General, the Commission for the Investigation of Abuse of Authority, and other existing
executive, quasi-judicial or judicial bodies of Nepal.
NHRC maintains good governance by performing following functions:

1. Respect, Protect and Promote human rights and ensure effective enforcement of human rights.
2. Inquire on petition or complaint sent to the Commission and investigate complaints about the
violations of human rights of an individual or group and make recommendation for action against
the perpetrators.
3. Recommend to the concerned authority to take departmental action against any official, who fails
to fulfill or perform his or her responsibility or duty or shows reluctance in preventing violations of
human rights.
4. Recommend to file a case in the court in accordance with law against any person or organization
who has violated human rights.
5. Coordinate and collaborate with the civil society in order to enhance awareness on human rights.
6. Carry out periodic reviews of the relevant laws relating to human rights and make
recommendation to the Government of Nepal for necessary improvements and amendments to
such laws.
7. Recommend Government of Nepal for the implementation of any international treaty or
agreement on human rights, to which Nepal is a party.
8. Publish, in accordance with law, the names of the officials, persons or bodies who have failed to
observe or implement any recommendations or directives made or given by the Commission in
relation to the violations of human rights, and record them as violators of human rights.
9. Governance through planning process and strategies:

Policy for Good Governance Strategy

Enhancing the Rule of Law Strengthening the capacity of Supreme Court

Awareness program for the common people to
understand about the rule of law.
Collaboration with the various stakeholders for the
enforcement of rule of law.

Strengthening the capacity of Enlarge the scope of Corruption Act, 2059

CIAA Provide necessary labor and financial resources to
CIAA
Timely appointment of the Chief of CIAA
Open regional level offices
Keeping the CIAA away from political affluence

Involve the Civil Society to Involvement of the Civil Society Organizations in

the Governance Process
 the drafting of policy documents
Involving the civil society while implementing
policy.
Including the opinions and suggestions of the civil
society in the policy
Listening the issues and problems raised by the
Civil Society

Carrying out Anti-Corruption
Activities at Local Level
Allocate more rights and power to CDO for
controlling the corruption.
Maintain complaint box in every service providing
offices in cooperation with representatives of CSO.
Formulate the “complaint hearing unit” in every
service providing offices in cooperation with the
representative of CSO.
Formulate district level Corruption Prevention
Committee.

Increasing awareness on the Disseminate more material on the present RTI Act
Right to Information on various media.

Enhancing accountability of Fully implement the provision of keeping Citizen

public office holders Charter in every service providing agency.

Planning for Good Draft annual Good Governance plan at center

Governance

Framework for Good Governance in Nepal:

Governance framework are the structure of a government and reflects the interrelationship factors
and other influences upon the institutions.
Institutional Arrangements
State Management Authority to enquire about issues of financial or management
Committee and Public irregularities. The committees can summon ministers or civil servants
Accounts Committee to committee hearings for questioning.
Supreme Court Highest judicial body comprised of a Chief Justice and no more than
14 judges. Additional judges (up to 10) may be appointed for a fixed
term as needed. On the recommendation of the Constitutional
Council, a Chief Justice is appointed for 6 years. The Chief Justice
then appoints other judges on the recommendation of the
Special Court A three-program and project-member court comprising a chairperson
and two judges of appellate level. Adjudicate cases of corruption. Its
decisions can be appealed to the Supreme Court.
District court It also tries offenses against the state and cases of money laundering.
A trial court with jurisdiction to hear all civil and criminal cases. Each
of Nepal’s 77 districts has a court. The Chief Justice appoints District
Court judges.
Administrative Court A three-program and project-member court constituted under the
Civil Service Act 1992. It hears appeals of departmental actions. The
chair is a serving or retired judge of the Court of Appeals.
Labor Court Constituted under the Labor Act 1991. Hears appeals of decisions
 relating to payment of salaries, allowances, gratuities, and provident
funds. The court also hears appeals of decisions of management or
company officials.
Attorney General Chief legal adviser to the government. The President appoints the
Attorney General on the recommendation of the Prime Minister. The
appointee holds office during the tenure of the Prime Minister and
represents the government in court.
Judicial Service Recommends appointments, transfers, and promotion of officers in
Commission the judicial service. However, examinations for appointment of class
III judicial officers are conducted by PSC.
The President Head of State. Main responsibility is to protect the Constitution. All
bills passed by Parliament become laws upon approval by the
President. The President may ask the government to reconsider a bill
but has no authority to reject it.

The Prime Minister Chief executive of the government.

Office of the Prime

Minister and Council Provide leadership to the civil service. Direct and supervise its
of Ministers performance and make the bureaucracy active and efficient. Lead
governance reforms.

Public Procurement Established as per the provision made in the new Public Procurement
Monitoring Office Act. Formulation and enforcement of public procurement laws,
under the Office of the policies, and guidelines. Monitoring of procurement processes and
Prime Minister and the contract management. Custodian of e-program and project
Council of Ministers government procurement (e-program and project GP) system. Provide
orientation and training on public procurement and e-program and
project GP.

Department for Control revenue leaks and misuse of foreign exchange. Established
Revenue Investigation under Anti Program and Project Money Laundering Act 2008 and
under the Office of the Prime Minister and the Council of Ministers.

Anti Program and Investigate and prosecute cases of antiprogram and project money
Project Money laundering and financial crimes. Nation’s financial manager, with
Laundering oversight of revenues and expenditures, budget preparation, and
Department responsibility for maintaining a stable economy.

Ministry of Finance Mobilizing and allocating resources, managing public investments and
expenditures and strengthening the productive capacity of public
enterprises. Oversees all government expenditures and consolidating
financial statements.

Financial Comptroller Manages a cadre of accountants, who are deployed to government

General’s Office (under agencies to provide accounting functions. Tracks revenue collection
Ministry of Finance) and computes other receivables, releases budgeted funds to
government agencies on a quarterly basis, and carries out their
 internal audits through District Treasury Comptroller’s Office.
Submits government’s annual consolidated financial statement to the
Office of the Auditor General, with details of total expenditures,
virements, and the position of the government treasury.
Institute of Chartered Autonomous body established under Nepal Chartered Accountants
Accountants of Nepal Act 1997. It is fully authorized to regulate the accountancy profession
in Nepal.

Nepal Rastra Bank Ensure monetary and financial stability in coordination with the
(Central Bank) Ministry of Finance. Committee chaired by the Minister of Finance
recommends appointment of the Governor. Main functions: issuing
currency, formulating and implementing appropriate monetary policy
and foreign exchange policy and systems, issuing banking licenses,
regulating commercial banks and financial institutions and serving as
their banker. Also functions as the government’s banker, adviser and
financial agent.

National Planning A planning body appointed by the Cabinet. Formulation of national

Commission vision, periodic plans and development policies. It provides a
framework for policy for all sectors and serves as a central agency for
monitoring and evaluating development plans, policies and programs.

Ministry of Law and Drafts bills, ordinances and executive orders, reviews and updates
Justice existing laws. It provides legal opinions to the government and edits
notices for publication in the Nepal Gazette.

Ministry of Federal The General Administration arm is responsible for central and federal
Affairs and Local civil service personnel management and record keeping. Formulates,
Development implements and reviews plans, policies, and programs for
recruitment, placement, promotion, salary, allowance, disciplinary
action and retirement of civil servants. All ministries, departments,
commissions, and central level offices need its approval before taking
any action related to civil service management. The federal affairs arm
is responsible for coordination among all government tiers related to
federalism issues.

Resource Commitee Members from MOF, NPC and the Central Bank. Prepares budget
forecasts, sets the ceiling, and prepares budget formulation guidelines.

Sectoral Ministries Formulate sectoral policies and plans to implement decisions and
directives of the government through various central and field level
administrative mechanisms (e.g., departments). Monitor and evaluate
program implementation. Ministries prepare policies or programs and
evaluate them from social, economic, administrative, legal and
financial perspectives. Ministries coordinate with other agencies and
stakeholders and, following revisions submit a final policy or program
to the Cabinet for approval.
Departments Implement approved programs and policies, supervise and coordinate
field offices, develop technical skills, provide advice to the ministry
and ensure effective service delivery.
National Vigilance Established under the direct supervision and control of the Prime
Center Minister in accordance with the Control of Corruption Act 2002. Main
 task is to promote integrity and good governance and prevent
corruption. Monitors incomes and individual property statements of
public servants (asset declaration). Undertakes technical audits of
projects to check compliance with laws, regulations and standards.
Constitutional Provisions
Commission for the Authority to investigate abuse of authority and unlawful gains by
Investigation of the public officials, including political appointees. It has 10 regional and
Abuse of Authority liaison field offices. Where CIAA does not have a presence (e.g.,
remote districts), the authority to address corruption is delegated to
Chief District Officers. If a person is found guilty, CIAA can file a case
in court or recommend departmental action by the relevant authority.
It also advises the government on policies and laws to curb
corruption. CIAA commissioners are appointed by the President on
the recommendation of the Constitutional Council for a period of six
years. The CIAA submits an annual report to the President, which is
discussed in the governance committee of Parliament.

Office of the Auditor Audit finances of all government offices, including the judiciary and
General the legislature. The Constitutional Council recommends the Auditor
General, who serves for a period of 6 years or until the retirement age
of 65. PAC discusses the Auditor General’s annual report on behalf of
Parliament.

Public Service The government is required to consult the Public Service Commission
Commission on all matters related to personnel management, especially the terms
and conditions of service and the principles to be followed in
recruitment, promotion, and departmental action against civil
servants. Its main task is to conduct examinations for selecting
candidates to fill vacant positions.
Legal Provisions:

Legal Framework/ Provisions

Strategies
It has taken bribery as a criminal case. It empowers the concern person
to file a case of taking bribe in the name of an employee of an office to
the office of higher authority. Under the Act, the briber can be
Civil Code 1863 punished imprisonment of 2‐6 years or fine up to NRs 5000.
Anti‐corruption It consists of 13‐point anti‐corruption strategies of the government.
Strategy, 2009 The government of Nepal is committed to fully implement the
strategies. It commits to ratify UN convention on anti‐ corruption. It
commits to make public construction and public service delivery more
systematic, competitive, transparent and accountable.
Money Laundering It prohibits anybody to launder or cause to launder money. It has
Prevention Act, 2008 defined a number of acts as offences of money laundering.
It requires banks and financial institutions to have a clear identity of
their customers and their transactions. It provides for a Financial
Information Unit in Nepal Rastra Bank for collection and analysis of
information relating to money laundering. It requires government to
establish Asset laundering Prevention Department.
National Vigilance It has clearly stated the procedures to be followed by NVC in carrying
Centre (Procedure), out its functions as prescribed in Prevention of Corruption Act, 2002.
2003 It has specified the rights and duties of NVC Chief. It empowers NVC to
collect statement of property of civil servants and to assess their
property statements and may forward to the concerned agency if
 further inquiry is deemed necessary.
Army Act, 2007 The Act has provided for a three member committee headed by Deputy
Attorney General to inquire and investigate cases of corruption
committed by army personnel. The cases will be heard by an army
special court.
Impeachment As per the Act, 25% of parliamentarians may submit impeachment
(Procedural proposal to dismiss the officials of constitutional bodies including
Regulation) Act, 2002 judges of the Supreme Court. In corruption charges, the
Parliamentarian Inquiry Commission may inquire and investigate itself
or can seek help from a suitable person or agency. The official of a
constitutional body is automatically dismissed from his or her post if
an impeachment proposal is passed by the parliament.
Special Court Act, The Act allows government of Nepal to form a special court to
2002 accomplish the trial and decision of special types of cases in a
expeditious, prompt and effective manner. It requires special court to
decide a case generally within 6 months of filing the case and requires
supreme court to decide on the appeal made over the decision of
special court generally within 3 months.
Prevention of This Act is a very powerful tool in combating corruption in the country.
Corruption Act, 2002 It is known to everybody. The Act is applicable to all Nepalese citizens
and public servants residing everywhere. It has clearly defined 18 acts
to be offences of corruption which ranges from bribe taking to property
deemed to be acquired illegally. The Act provides for punishment up to
10 years. If an act of corruption is committed by office bearer of
constitutional body, or by special class officer or equivalent, he or she
is liable to additional three years imprisonment in addition to the
punishment
Commission for the It has clearly mentioned the functions of CIAA Secretary. It has clearly
Investigation of Abuse stated the provisions of complaints , procedures of initial inquiry and
of Authority Rules, investigation, and matters to be stated in charge sheet. The Rules have
2002 clarified the other necessary action to be taken by the Commission as
per the Act.
Judicial Council Act, The Act recognizes the judge's conduct as misconduct if he or she has
1991 performed any work to be deemed as corruption under the current law.
It empowers inquiry committee to exercise the power as conferred on
to the Investigation officer under the Prevention of Corruption Act,
2002. The Act empowers Council that may file a case to court of appeal
against a judge.
Commission for the This Act is very comprehensive. CIAA may conduct investigations, file
Investigation of Abuse a case or take action against any person holding a public post for an
of Authority Act, 1991 abuse of authority. CIAA may write to the appropriate authority to
caution or to take departmental action against a person who is found to
have committed an act of improper conduct. It empowers CIAA to
write to the concerned authority to make up for losses incurred. It
empowers CIAA to rectify bad results arising out of improper conduct.
It empowers CIAA to keep the accused in detention
if there is adequate to do so. CIAA may conduct inquiries and
investigation in respect to corruption on the basis of a complaint

Decentralization, Development and Democratic Governance

Decentralization: It is the establishment of local bodies outside the regular bureaucratic structure.
It is the transfer of authority and responsibility for public functions from the central government
to subordinate or quasi-independent local bodies or private sector. It refers to the restructuring of
authority so that there is a system of co-responsibility between the institutions of governance at
the central, regional and local levels.

Development: According to MP tomato, development is process of improving the quality of all

human lives with three equally important aspects:
A) Raising people's living levels i.e. income and consumption, level of foods, medical
services, education through relevant growth process.
B) Creating conditions conductive to the growth of peoples self esteem through the
establishment of social, political and economic systems and institutions which
promote human dignity and respect.
C) Increasing peoples freedom to choose by enlarging the range of their choice
variables eg; varieties of goods and services.
Democratic Governance: It is running the government according to the principles of democracy i.e.
increasing participation of people, listening the opinions of people on public policy. Democratic
governance runs on the principle of: of the people,by the people, from the people and for the
people
Relationship between Decentralization, Democratic Governance and Development:
As above mentioned in the definition, decentralization transfers the authority from the center to
the people. This transfer of authority enables the people to develop development according to their
needs, increase their participation, making people freedom to choose their leaders and policy.
These all are the aspirations of development and democratic governance. The above mentioned
definition of development according to Todaro clearly shows the principle of decentralization and
democratic governance. The main point of Todaros definition are:
A) Raising people's living levels i.e. income and consumption, level of foods, medical services,
education through relevant growth process.
The rise mentioned in this definition can only be achieved through decentralization since if
the authority over resources and finance comes on the hand of the people.
B) Creating conditions conductive to the growth of peoples self esteem through the establishment
of social, political and economic systems and institutions which promote human dignity and
respect.
The conditions described in the above point can only be achieved when there is democratic
governance and decentralization. When there is democratic governance, people can express
their opinions and views which help to build their self-esteem and the required social,
political and economic systems and institutions is only possible when the decentralization is
effectively implemented.
C) Increasing peoples freedom to choose by enlarging the range of their choice variables eg;
varieties of goods and services.
Freedom to choose and Freedom to express can only be achieved through the democratic
governance. Country which is ruled under the autocracy can never achieve and never allow
the freedom to the people.

The main requirement of democratic governance is decentralization. Democratic Governance is

only possible through the decentralization. Democratic governance runs according to the principle
and proposal of decentralization where people can choose their leaders and where the authority
resides on the hands of the people. In the absence of decentralization, the existence of democratic
governance is only myth. In the unitary states, the democratic governance is almost impossible
since people are not allowed to choose their leaders.
Development is not only about the economic growth but rather a freedom to express opinions.
When there is not that freedom, the democratic governance has not any authenticity.
Conclusion: Hence, decentralization, democratic governance and decentralization are the three
sides of the triangle and these can’t exist without others.
Unit VI. Decentralization Practices in Nepal
Public Policy
It is the instrument by which government translates political vision into deliverable outcomes for
achieving desired changes. It is the system of laws, regulatory measures, courses of action and
funding priorities concerning a national agenda promulgated by a governmental entity or its
representatives. The formula of successful public policy is rationality, logic to produce desired
outcomes, emotional effectiveness for motivated association and strategic actions to lead policy
implementations.
Characteristics of Public Policy:
a. It is purposive or goal oriented.
b. It follows a pattern of action.
c. It is either positive or negative in form.
d. It is an actual doing of government.
e. It is based on law and authoritative action.
Types of Public Policy:
a. Regulatory Policy
It is regulatory in nature. It imposes restrictions on behaviors of the economic agents. It
reduces the freedom enjoyed by economic agents. It is concerned with regulation of trade,
business, safety, measures and public utilities.
b. Self-Regulatory Policy
It involve restriction or control of some matter or group. They differ from the regulatory
policies as they are usually sought and supported by a regulated group as means of
protecting or promoting their own interests.
c. Distributive Policy
It is meant for specific segments of the society. It grants goods and services such as all
public assistance and welfare program to a specific segment of the society.
d. Re-distributive Policy
It is designed to redistribute certain goods and services such as income and wealth in favor
of certain groups in a society. It is the deliberate effort of a government to shift distribution
of income and wealth from wealthy to poor and disabled groups in the society.
e. Substantive Policy
It involve what a government is going to do such as construction of highways or payment of
welfare benefits. It is concerned with general welfare and development of a society.
f. Procedural Policies
It involve who is going to take action or how is it going to be done. It is the procedures
which government bodies have to perform while performing certain activities.
g. Capitalization Policies
It is the financial subsidies given by a government to state and local government. It is also
granted to the central and state business undertakings or some other important spheres. It’s
aim is to increase production or productive capacity of an economy.
h. Ethical Policies
 It is policy targeted to regulate moral actions of individuals. Moral and ethical values of
citizen play an important role to build good institutions which are conductive for economic
growth.
i. Material or Symbolic Policy
Material Policy-It provide tangible resources or substantive power to beneficiaries or
impose real cost/disadvantages on those who are adversely affected.
Symbolic Policy-It distributes advantages or disadvantages which have unsubstantial
impact on life of common people.
j. Goal Policies
It is the set of a goal to be achieved without maintaining anything about the means. It
emphasizes the goal to be achieved but does not include means through which the goal is to
be achieved.
k. Liberal or Conservative Policy
Liberal Policy-It is directed towards the correction of injustices and shortcomings in the
existing social order by using the power of government.
Conservative Policy-It focuses that social change occur slowly and gradually through the
natural order and do not favor the use of government power to change the social order.
l. Substantive, Institutional and Time period Policy
Substantive Policy-It includes labor, welfare, civil rights and foreign affairs.
Institutional Policy-It include legislative, judicial and departmental policies.
Time Period Polices- It is the policy expressed w.r.t time period.
m. Role Policies
It specify action to be formed or work to be done.
Stages of Public Policy
Stage I: Setting the Agenda
It is the first step in public policy formulation. Agenda is the list of subject or problem to
which government officials and people outside the government officials are paying some
serious attention at any given period. At this stage problems requiring government to take
actions are identified by government. Following are the things which determine the agenda:
a. Ideology
Every society operates in a separate ideology. A policy must be according to the ideology
of the society.
b. Politics
It is the second thing that matter on the agenda. A political perspective is adopted not
necessarily related to any political party and issues related to that particular perspective
are likely to receive consideration.
c. Economics
Though politics play major role in policy formulation, political parties do not formulate
their manifestos in an empty and they must consider economics. Here economics means
resources which are used to do about an issue. The behavior of national and
international economy affects the agenda of public policy making.
d. Crises
It gives rise agenda for public policy. Crises like the HIV/AIDS, the Gulf War, various
terrorist activities and many others demands a policy to counter them. Sometimes crisis
means a rethinking of a whole area of public policy.
e. Pressure
Pressure from different groups also give rise agenda for public policy. Public pressure
may be applied even without a crisis situation if a group is sufficiently well organized
and well resourced to force attention.
Stage II: Formulating the Answers
 The responses to the demand for public policies primarily depends upon which resources are
required and how they may be required. There are especially three types of resources used for
formulating public policies:
a. Material: It includes finance, land and capital.
b. Technical: It includes expertise, efficiency and effectiveness.
c. Support: It includes support from various stakeholders.
Stage III: Making Decision
Policy is prepared by experts but the decision to be implemented is taken by politicians.
Making decision includes the following:
a. Making a Decision: It means a relatively open agenda with a number of different options to
consider including the decision not to decide at all.
b. Taking a Decision: It means agreement with a proposal that is set out in full detail before
the legislator. It is the government that sets the agenda and formulate policies.
Stage IV: Implementing the Decision
Once the decision is made, it is implemented by the executive branch of the government. It
requires the same resources as those required for policy formulation such as finance, land and
capital.
Stage V: Evaluation
It is the final stage. It includes the monitoring, analysis , criticism and assessment of existing or
proposed policies. It’s purpose is not to justify a policy rather to check its effectiveness so that if
it is seen to be unsuccessful it may be adjusted.

Nature of Public Policy

According to Anderson (1975), “the nature of public policy as a course of action can be better or
fully understood if it is broken down into number of categories, these being policy policy demands,
decisions, statements, outputs and outcomes. In practice, they will not necessarily occur in a neat
sequential order."
1. Policy demands
Policy demands are the claims made by individuals or other actors with the government in a
political system for action or inaction on some perceived problem. Such demands may range from
a general insistence that the government ought to do something to a proposal for specific action on
the matter. There are various factors which gives rise a need of policy demand. They may be as for
examples, the ideology of democracy, political factor, economic factor, and pressure of general
public (Mather 2001). This has enforced the government to formulate a particular policy to
overcome the problem. In the Nepalese case, an increasing pressure from the general public to
band polluted vehicles in Kathmandu valley had forced the government to realize a need to control
pollution produced by such vehicles. Similarly, due to an increasing pressure from donor
communities to undertake economic reform programs to achieve macroeconomic stability, had
forced the government to realize a need of economic reforms in Nepal in the decade of eighties.
2. Policy decisions
Realizing a need of policy, the next step is to make policy decision. Policy decisions are the
decisions made by public officials that authorize or give direction and content to public policy
actions as accordance to the demand of individuals or other actors of a political system (Anderson
1975). It includes decision to enact a law or policy by the parliament, issues executive orders or
edicts, promulgate administrative rules, or make important judicial interpretation of the-law. For
example, after realizing the need to control environmental pollution, the government enacted the
Nepal Mass Emission Standard 1994. In the same way, realizing need to reform the economy, the
government initiated various programs including external sector reform, privatization and
liberalization, and financial sector reform to liberalize the economy after the restorati of a
multiparty democracy in 1990. All these are policy decision made by the in course of materializing
policy demand.
3. Policy statements
Policy statements are a formal expression or articulation of public policy They include legislative
statutes, executive orders and decrees, administrative rules and regulations, and court opinions. In
addition, it includes statement and speech made by public officials indicating intentions and goals
of realize them. The policy statements are sometimes ambitious and policies issued by different
agencies of a political system may be responsibility of the top political leaders to make the policy
statement as realistic as possible and to reconcile conflicting interest of the stakeholder.
1. Policy outputs
Policy outputs are tangible manifestation of public policies. It is what the government does as
distinguished from what it says - it is going to do.The matters like tax collection, highway
construction, provision of irrigation facilities, distribution of drinking water telephone lines and
electricity, and school enrollment ae policy output. As for example, during the Ninth Plan, the
government had the policy statement to bring down poverty level to 32%, it is the policy output.
6.Policy Outcomes
Policy outcomes are the consequences for a particular social group or groups, intended or
unintended, that flow form action or inaction by the government (Anderson 1975). Policy
outcomes show effect of public policies on life of the people. In other words, it shows whether there
is divergence between policy output and policy outcomes, i.e.. commitment and outcome. In the
Nepalese context, several programs have been implemented to reduce poverty, to reduce
inequality, and to generate employment opportunities. In order to see the policy outcome, we
should study about their effect in the society, on where the policies are being implemented. As for
example, how much improvement was brought on the living standard of the people, how much of
employment opportunity was generated by the programs, how much of the inequality was reduced
by the poverty alleviation programs, how much of the poor got institutional credit facilities.
Questions such as these may be quite difficult to answer, but they direct our attention to assess the
impact of public policy.