1 ETHIOPIA -- DECENTRALIZATION, DELIVERY AND ACCOUNTABILITY A Synthesis of Studies Undertaken for the Institutional and Governance Review Process June 30, 2006 This synthesis draws on the very extensive background work conducted as part of the multi-donor Institutional and Governance Review process; the IGR, in turn, was conceived and implemented as part of the Public Sector Capacity Building Program. Between 2001 and 2005, Navin Girishankar led the IGR process and PSCAP preparation; he played a key role in providing the vision and strategy which underpinned these initiatives, and following through with implementation. Important contributions to this four year effort were made by other members of the team working on Ethiopia, including Dave DeGroot, Elsa Araya and Shenaz Ahmed, plus Gaiv Tata, Vivek Srivastava, David Savage, Harry Garnett, Kevin Brown, Jit Gill, Eshetu Yimer, Samuel Haileselassie, Francisco Roquette, Chris Heymans and Mohammed Mussa. The synthesis was written by Brian Levy. 70237 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized
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ETHIOPIA -- DECENTRALIZATION, DELIVERY AND ACCOUNTABILITY
A Synthesis of Studies Undertaken for the Institutional and
Governance Review Process
June 30, 2006
This synthesis draws on the very extensive background work conducted as part of the multi-donor
Institutional and Governance Review process; the IGR, in turn, was conceived and implemented
as part of the Public Sector Capacity Building Program. Between 2001 and 2005, Navin
Girishankar led the IGR process and PSCAP preparation; he played a key role in providing the
vision and strategy which underpinned these initiatives, and following through with
implementation. Important contributions to this four year effort were made by other members of
the team working on Ethiopia, including Dave DeGroot, Elsa Araya and Shenaz Ahmed, plus
Gaiv Tata, Vivek Srivastava, David Savage, Harry Garnett, Kevin Brown, Jit Gill, Eshetu Yimer,
Samuel Haileselassie, Francisco Roquette, Chris Heymans and Mohammed Mussa. The synthesis
was written by Brian Levy.
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I: Introduction
Since 1994, governance reform in Ethiopia has centered around efforts to
restructure what had been a radically centralized state by devolving authority. Momentum
has been sustained in recent years, with a decision in 2002 to deepen decentralization to
lower tiers of government, and its subsequent aggressive implementation. Ethiopia’s
development partners have been centrally involved in the process, contributing to policy
discussions, implementation, and empirical assessments of challenges and progress on the
ground. (The World Bank played an important role, via its leadership of the multi-donor
Public Sector Capacity Building Program [PSCAP] and by bringing to bear its analytical
and advisory resources.1.)
One of the fruits of this partnership was the preparation of an unusually rich set of
background papers, under the umbrella of a process-driven Institutional and Governance
Review (IGR); this Analytical and Advisory work was skillfully designed to support the
design and implementation of PSCAP. Some of the papers focused on policy; others
provided qualitative assessments of the realities on the ground; yet others benchmarked
different facets of the governance environment, as a basis for monitoring going forward.
A comprehensive synthesis of these IGR papers (referenced in Part A of the
bibliography) is neither necessary not desirable; they stand on their own terms. (Also: see
the powerpoint overview in Appendix 1 of Ethiopia’s decentralization experience
prepared by the World Bank team which led the process.). The objectives of this IGR
summary are more modest, namely to:
Provide (following staff turnover in the World Bank team) an ‘entry point’ of
access to some of the rich materials which have been prepared under the IGR
umbrella;2
Draw on the materials (plus other background material on Ethiopia) to provide a
qualitative, on-the-ground sense of the extent to which the 2002 reforms have
transformed the local governance realities;
Highlight some of the important base-line benchmarking exercises which were
completed under the IGR umbrella, and which provide a key basis for monitoring
progress going forward ; and
Point to some ways in which benchmarking can support the broader objective of
strengthening the accountability for performance of Ethiopia’s government, in the
context of the political realities prevailing in 2006.
A common theme which links these objectives is accountability – including the extent to
which decentralization has strengthened accountability from the ‘bottom-up’, and the role
of benchmarking as a tool for monitoring reform progress, and strengthening
1Between 2001 and 2005, Navin Girishankar led the World Bank work on governance and decentralization
in Ethiopia; he played a key role in giving strategic clarity to the World Bank’s support, and setting and
sustaining high standards of quality. Important contributions to this four year effort were made by other
members of the team working on Ethiopia, including Dave DeGroot, Elsa Araya and Shenaz Ahmed. 2 At least two of the papers focused on aspects of civil service reform; this subject is not taken up in the
present paper.
3
accountability more broadly. The next section reviews recent reform experience against
the backdrop of longstanding patterns of governance in Ethiopia. Section III focuses on
progress in benchmarking and monitoring performance, and suggests some ways in
which such data can strengthen accountability. Section IV concludes.
II: Decentralization: From Subject to Citizen3
Until the 1990s, going back deep into the historical past, Ethiopians have been
subjects, not citizens – first of a quasi-feudal monarchy, then of a totalitarian Marxist-
Leninist state. The political transformation which came with the overthrow of the
Marxist-Leninist Derg regime in late 1990 saw the flowering of the aspiration to give
Ethiopians their full rights as citizens. The subsections which follow offer three sets of
perspectives as to the extent to which this aspiration has been realized. The first provides
a broad overview of the process through which the formal Ethiopian state structure was
transformed from one of the most centralized on earth, to one of the more decentralized.
The second highlights some reform achievements. The third provides a bottom-up, local
perspective as to the extent of change.
Transforming a Centralized Legacy
Ethiopia’s political history is unique in sub-Saharan Africa in that the country was
never systematically colonized by a European power. Consequently, the Ethiopian state
has evolved through ongoing local political processes – not through any single defining
moment of state creation associated with the achievement of independence. While the
origins of the Ethiopian (monarchical) state can be traced back more than fifteen hundred
years, modern Ethiopia can be dated as starting from a series of military victories (against
Egyptian invaders, the Sudanese dervishes, and putative Italian colonizers) of King
Yohannes in the latter-nineteenth century. Over the subsequent century, Ethiopia’s
territory continually expanded, with political authority heavily centralized in Addis
Ababa – not only in the latter years of the monarchy, but also during the fifteen years of
rule by the Marxist-Leninist Derg regime.
Consistent with this long history of hierarchical, centralized rule, the traditional
Ethiopian social order was one of authority and superior-subordinate relationships. A
1972 study described the pattern as follows:
“’Subservience to, and respect for, persons of higher authority is a fundamental
lesson taught to the Ethiopian child. Authority figures are subject to highly
elaborate expressions of praise, and it is expected that, at least in appearance,
there will be compliance to the wishes of any authority figure….any act of
initiative on the part of the subordinate is, in a sense, a rejection of his show of
3 Mahmood Mamdani, Citizen and Subject: Contemporary Africa and the Legacy of Late Colonialism,
Princeton: Princeton University Press, 1996 uses the distinction between citizens and subjects as a basis for
analyzing the dynamics of African states.
4
dependency demanded by the big man’…..‘there does not appear to be a word in
Amharic equal to the notion of ‘public servant in English; the terminology used
for government officials is translated as ‘employee of the government’’ 4”
When the Derg regime collapsed, and the Tigray Peoples Liberation Front (TPLF)
marched into Addis Ababa in late 1990, it inherited a state which, except in its Amharic
core, was confronted by a variety of separatist rebellions. The Eritrean rebellion was the
most widely reported; but (Tigray aside) rebel movements had also gained strength in
Oromo and a variety of less populous outlying regions (e.g. Somali) whose sense of
affiliation to the Ethiopian state had always been tenuous. The response of the new
political leadership to the fragility, and lack of legitimacy, of the centralized state, was
multifaceted – constitutional, political and economic.
The constitutional response to state fragility comprised the elaboration of a new
institutional framework – built around formal devolution of state authority. The 1994
Ethiopian constitution radically devolved hitherto radically centralized authority. The
constitution included the following features:
Participation in the Ethiopian federation was voluntary, with regions retaining the
right to secede (a right immediately taken up by Eritrea)
Except where otherwise explicitly asserted, authority was vested in Ethiopia’s nine
regions – not the Federal state at the center.5
Intergovernmental fiscal transfers were on the basis of block grants, not earmarked
programs; as of 1997/8, over 45 percent of Federal revenues were transferred to the
regions in this fashion.
The ethnic diversity of Ethiopia was made part of the decentralization design – with
regional and sub-regional boundaries drawn in ways which explicitly gave geographic
recognition to ethnic identities, including the official use of local languages for state
business (a major departure from the earlier official dominance of Amharic).
2002 saw a further round of decentralization reforms, which deepened the political
commitment to shifting formal authority downwards. The use of unconditional bloc
grants -- the basis for resource transfers from the federal to regional authorities – was
extended to encompass transfers from the regional tier to the lower, woreda, tier of
government. As with federal grants, the size of the bloc grant was based principally on
population, with some weighting for development needs, and local revenue mobilization
effort. The bloc grants to woredas generally amount to over 60 percent of the total
regional budgets. Consistent with these reforms, the decision was taken to scale back the
4 The extended quote within the quote is from Korten (1972), quoted in ‘Empowerment in Ethiopia’
(2005). 5 Formally, explicit federal responsibilities including defense, foreign affairs, aggregate economic policy,
external economic relations (including borrowing and receipt of grants). others?; regions were
unequivocally for both policy and implementation in the social and productive (e.g. agricultural) sectors,
with the centers role advisory. In practice, as discussed further below, definition of the boundary between
the Federal government and the regions is an evolving work in progress.
5
role of zones – an administrative tier intermediate between regional and woreda levels –
and transfer the bulk of their personnel to the woredas.
The political response came in two phases. In the first phase, immediately after
coming to power, the TPLF rapidly built a network of affiliated structures in the other
regions, and constituted these structures into a new ruling political party, the Ethiopian
Peoples Revolutionary Democratic Front. The EPRDF asserted strong political control
in all but the most peripheral regions of Ethiopia. In these regions, the common party
platform at both center and periphery ensured that authorities at all levels co-operated in
the implementation of a new constitutional order. As one of the background papers for
the IGR characterized it, the result by the mid-to-late 1990s was “a de facto party-state
merger’. (Vaughan 2004, p.17)
A second phase of the political response was initiated at the Fourth Party Congress of
the EPRDF in 2001. At this congress, the EPRDF announced its intention to transform
radically the relationship between government, the ruling political party, and citizens:
“We need an organizational structure…so that government bodies at all levels
receive competent professional and political leadership. Our party must be
enabled to give a more refined and stronger political leadership than ever before.
That, nonetheless, must be done separated from government work and in
accordance with government rules and regulations. The conditions necessary for
the separation of the civil service structure from that of the political leadership
must be created….not only at the federal government level, but at all levels…We
must also ensure the separation and clearing of the powers of the legislative and
the executive bodies of government and thereby translate into action the
democratic principles of checks and balances…at the federal, regional and other
levels…We must facilitate the conditions necessary for the full participation of all
Ethiopians in all discussions to be held on issues pertaining to our development
and democratization efforts”.6
A later subsection of this paper summarizes some preliminary evidence as to the extent to
which implementation of these goals has proceeded at local levels. Clearly, as the 2005
elections and their aftermath revealed, realizing them is a formidable challenge.
As for the economic response to the fragility and lack of legitimacy of the centralized
state, complementing the equitable formula-based arrangements for the allocation of
fiscal resources, the development policies of the EPRDF aimed to assure equitable
growth. In particular, the government’s strategy of Agriculture Development-Led
Industrialization (ADLI) aimed to kick-start sustained growth through broad-based
improvements in the productivity of peasant agriculture. (As the upcoming CEM argues,
such peasant led growth strategies are consistent with the approach successful East Asian
developing countries.)
6 EPRDF Fourth Congress Report, August 2001, p. 47.
6
Some Achievements
This section highlights two sets of achievements associated with Ethiopia’s
efforts to shift authority and resources downwards: institutional change and results vis-à-
vis service provision. (Economic development performance is discussed in the 2006
World Bank Country Economic Memorandum.) The emphasis is on changes since the
2002 reforms. (Appendix A provides a more comprehensive overview.)
Institutional changes. Four sets of institutional achievements are worthy of note.
They are identified in each of three separate studies – a review (field based, in four
regions) by independent international consultants of trends in intergovernmental region-
to-woreda relationships subsequent to the 2002 reforms (Heymans and Mussa, 2004); a
late 2005 CIDA-funded synthesis of progress and prospects for grassroots empowerment
(Plan: net 2005) and a late 2005/early 2006 study of trends in implementing
decentralization in Tigray (Dom and Mussa, 2006).
First, the political will from the highest levels to empower the woreda and the
‘grass-roots’ through decentralization is strong – both in the Federal Government
of Ethiopia, and in Regional Governments.
Second, the decision taken in 2002 to move to decentralize within regions by
making budget transfers to woredas in the form of unconditional bloc grants has
been implemented fully. (How budgeting proceeds in practice within woredas will
be discussed below.)
Third, sub-national administrations have indeed been transformed to align with
the empowerment of woredas. The authority of zones, an intermediate regional
tier of government, has been radically scaled back, with very large portions of
their staff re-assigned to woredas.
Fourth, there have been major commitments to invest in the capacity needed to
make this decentralized system work: the regional affairs units of the Federal and
Regional Ministry/Bureaus of Finance and Economic Development have been
strengthened; a Ministry (and regional bureaus) of Capacity Building has been
established; intensive training for woreda-level staff has been provided by a
scaled-up Civil Service College; and the Public Sector Capacity Building Program
(PSCAP) has been designed explicitly to support the decentralization process, and
to facilitate a sub-national, demand-driven approach to setting and financing
capacity building priorities.
Notwithstanding these important advances, as Box 1 and Appendix A summarize, some
major policy challenges remain.
7
Box 1: Getting decentralization right – some ongoing challenges
An in-depth 2004 review of issues in intergovernmental relations in Ethiopia (Heymans and Mussa, 2004)
highlighted a variety of priority challenges as of that date, including the following:
1. Clarify expenditure assignments. The assignment of responsibilities among regions, zones, woredas,
municipalities and kebeles remained unclear.
2. Clarify local revenue sources – especially for urban municipalities who raise the bulk of their revenue
locally. Challenges include making revenue authority clearer, streamlining some local taxes, building the
capacity of local governments to improve revenue collection, and assuring that the bloc grant formula does
not penalize local governments that make an effort to collect revenues.
3. Strengthen local government budgeting of capital expenditures, both the capacity to undertake the
function, and resource availability. (The preparation of a Local Infrastructure Grant facility is one part of
the response to this issue.)
4. Clarify the role and modalities for rule-based conditional grants. PSCAP (now being implemented) and
LIG (under preparation) will provide important opportunities for learning.
5. Adapt audit systems to the decentralization era.
6. Strengthen the capacity for subnational fiscal analysis of both the Federal Ministry of Finance and
Economic Development and the regional Bureaus (BOFED’s).
7. Address the special capacity challenges of remote rural woredas.
Policy issues raised in other studies included the following:
8. Clarify systematically the role of municipalities. Municipalities currently do not operate under a
consistent legal framework. (Selam, 2005)
9. Clarify how the one-off and ongoing costs of decentralization are to be met. The combination of
infrastructure, logistical and salary costs associated with planned expansion of the role of woredas have
been estimated, if amortized over 15 years, to be of the order of US$500 million per annum (Srivastava,
2005). Some combination of one-off grants, and modification of plans will be needed to meet these costs.
Service provision. Evidence of ongoing improvements in service provision comes
from both aggregate data, and from the 2004 pilot citizens score card. Aggregate data
(taken from World Bank 2006a and b) point to the following improvements:
For education, the nationwide primary gross enrollment rate doubled from 37
percent in 1995/6 to 74 percent in 2004/5.
For health, immunization rates for children under five rose from 40% in 1995/6
to 56% in 2004/5
For safe drinking water, the share of the population with access rose from 19% in
1995/6 to 36% in 2004/5.
The results of a pilot Citizens Report Card survey confirm these patterns. The
CRC surveyed over 3300 households in four regions (Afar, Oromia, SNNPC and Tigray)
in early 2004;. As Table 1 below summarizes, across the four regions, for each of water,
sanitation, health and agricultural extension, the CRC found both quite high levels of
satisfaction with the quality of services, and consistent reports of improvements in
service quality over the past two years. Though Ethiopia’s deferential culture might
account for some overstatement, the pattern is nonetheless remarkable.
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Table 1: Citizen perceptions of service quality and trends, 2004. Overall satisfaction (%) 2-year trend in service quality (%)
Completely
satisfied
Partially
satisfied
Dissatisfied Worsened Same Improved
Adequacy of
public taps and
hand pumps
rural
(urban)
55
(58)
27
(31)
18
(11)
3
(5)
34
(21)
63
(74)
with health
services (overall)
50
(59)
33
(13)
17
(28)
2
(7)
29
(25)
64
(68)
With quality of
sanitation services
46
(26)
22
(14)
32
(60)
1
(19)
37
(40)
61
(40)
Agricultural
extension
22 30 48 8 25 58
Note: The rural areas surveyed were Tigray (838 households), Afar (601), Oromia (1201) and SNNPR
(594). One urban area was sampled, Dire Dawa (595 households). The percentages sometimes add up to
less than 100% where respondents ‘could not comment’.
How much change? A local-level perspective
This sub-section draws on recent field studies to provide a bottom-up perspective
on the extent of change. First, it examines how this state is experienced in practice by
citizens. Second, it explores the extent to which the 2002 policy decision to provide
woreda budgets in the form of bloc grants has indeed altered behavior at the woreda
level.
How citizens experience the local state. Even though both formal authority and
control over authority is with the woredas, in the lives of citizens, the fourth/fifth tier
(depending on whether zones are included as a separate tier) of government – the kebele
administration -- comprises the local face of the state. The 2005 Participatory Poverty
Assessment asked respondents to rank (by ubiquity, importance, and effectiveness) the
relevance of different local institutions in their lives. Of 70 different institutions which
were identified, the kebele consistently ranked in the top five in both rural and urban
settings – and often in the top three -- irrespective of the dimension being considered. In
rural settings, woredas did not make the 22 most important institutions in any dimension
reported. In urban settings, municipalities made the top 22-- but were consistently near
the bottom of the ranking. (In both urban and rural settings, schools generally were rated
as the most important local institution.) Kebeles are thus the front-line interface of the
state-citizen relationship – the focal point where citizen participation and state control
play out in practice.
The kebele administration has played a central controlling role in the lives of
citizens, at least since the time of the Derg. One continuing ubiquitous key role of the
kebele is to co-ordinate labor contributions to the construction and maintenance of local
infrastructure. The Participatory Poverty Assessment (2005, p.45) summarizes this role as
follows:
9
The purpose of organizing people’s social participation is to harness citizens’
energy more effectively towards collective community goals (such as building
classrooms, clearing irrigation canals, installing water pipes etc…) The positive
effects of community obligation are recognized….”
The magnitude of community contributions can be large. In Amhara Region, for
example, community contributions of cash, labor and materials amounted to 19 percent of
the total education budget for the region. And in Oromiya region, “communities built
2,515 new classrooms and rehabilitated another 2,575, constructed 110 new and