Issue No.
159, July 2011 Latest update 9 2014f August 2014, at 4.39 am
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Vineyard in Hebron. Photo from Palestine Image Bank.
Construction of a new road in Hebron. Photo from World Bank Archive.

Municipalities: Key Partners for Development

Local-level government in Palestine has had a long history. Since the Oslo Accords, municipalities have been assigned a clear role. They serve as part of the lowest level of governance, representation, and accountability for citizens. They also act as potential engines for development as they deliver several services.  Their importance is further emphasised by the urbanised nature of the Palestinian population, 74 percent of whom are urban dwellers who rely on services provided by 134 municipalities (Palestinian Central Bureau of Statistics Population Survey, 2007).

Municipalities face several challenges in fulfilling their role. Municipal budgets have significantly declined over the last decade primarily due to the ongoing conflict, the contraction of the economy, poor municipal management, and a growing culture of non-payment especially since the second Intifada. The deterioration of municipal finances has led to a subsequent deterioration of service coverage and quality, ultimately impacting negatively on the quality of life of most Palestinians. Localities in areas B and C face additional challenges of obtaining permissions for development.

Municipalities - Enginers for Development
The role of municipalities is critical in achieving sustainable development. Municipalities are  key actors in meeting basic needs through the 27 functions that they are legally required to provide. Most, however, provide far fewer. Three services are provided by 80 percent of municipalities, namely, solid waste management, street maintenance, and water supply. Seven services are provided by 50 percent of municipalities, including street lighting, town planning/roads, school maintenance and construction, and sidewalks.

The least provided services are museums, wastewater treatment, traffic management, slaughterhouses, social assistance, fire fighting, public lavatories, public transport, markets, and street names and numbering. Even in the areas where services are provided, substantial improvements are required. (See Box 1.).

Box 1: Some Facts on Service Levels
• 26 percent of water supply network is in need of maintenance
• 52 percent of municipal roads are unpaved and maintenance varies widely
• Municipalities have only 46 percent of equipment needed,
• Municipalities have 82 percent of classrooms needed, but maintenance varies widely

Several donors are supporting investments in infrastructure at the municipal level.  However, sustainable service delivery requires an improved municipal fiscal situation. Currently, average per capita expenditure from municipalities own budget sources is only NIS 9 per year. Ninety percent of the municipal budgets are allocated for recurrent expenditure leaving only 10 percent of the budget for capital investments. The deficits in service provision also reflect the small size of Palestinian municipalities: 101 municipalities have populations of less than 25,000 and therefore do not have the economies of scale to provide several services.

To improve their services, it is crucial for municipalities to look for opportunities for revenue collection. Municipal amalgamation also requires increased attention.

Governance, Representation, and Accountability
Elections are a key element to ensuring municipal accountability - and should be supported. But accountability goes far beyond just elections. Investments and budgets should be responsive to needs, and financial systems should allow municipalities to easily determine how its funds are being used. This would also help cut corruption and foster transparency. Finally, municipalities should also look carefully at how they interact with the public. Palestinian municipalities, and the Palestinian Authority, have made several interventions to support governance and accountability. 

Aligning municipal investments with needs. Several municipalities are undertaking Strategic Development and Investment Plans (SDIPs) to assist them in identifying priorities/needs and aligning their identified investments with such priorities. Community participation is integrated into the strategic planning process to ensure that community needs - especially those of marginalised people - are also integrated into the municipalities’ plans. Initial indications are that SDIPs have improved the way in which municipalities identify priority investments. However, there is still room for improvement. Participation in these processes is often not fully representative. There are also few public outreach units at municipalities. This is a challenge to institutionalising a people-driven development approach.

How does my municipality perform? Ranking municipalities to improve performance and accountability. The Palestinian Authority, through the Ministry of Local Government and the Municipal Development and Lending Fund (MDLF) has introduced a system of ranking municipalities. Currently, the rank is based on population, need, and performance criteria. Based on this rank, municipalities are then allocated a capital grant through the Municipal Development Program (MDP) which is a USD 50 program financed by Donors* and the PA. This is a good first step for municipal accountability. The logical next step is to supplement this ranking with a citizen-satisfaction ranking of municipalities. The MDLF is planning to facilitate a citizen-satisfaction survey by the end of 2011 to provide insight on the quality of municipal service delivery and coverage.

Transparency in financial disclosure. Municipalities are also starting to look closely at their financial procedures - partly pushed by the requirements of the MDP, which focuses on performance improvements of financial management. Through improved budget guidelines, municipal disclosure of their financial situation is now made easier. All municipalities now disclose their budgets to the Ministry of Local Government. Furthermore, several municipalities are also starting to publicly disclose their financial data. An estimated 56 percent publicly disclose their financial data and budgets, and 60 percent disclosed their performance rank (in accordance with the MDLF ranking system).

Developing a customer focus. Finally, municipalities are increasingly focusing on their citizens as customers. Through establishing citizen services centres, which are also called One Stop Shops (OSSs), municipalities are trying to serve their citizens using a private-sector approach, treating citizens as customers who should receive efficient and transparent services. Around 23 municipalities (including Ramallah, Nablus, Hebron, Salfeet, Qalqiliya, Bani Naim, Dura, Qabatia, Beit Furik) are operating fully modern OSSs, in which all municipal services are delivered from one place using an electronic approach. Prior to establishing such facilities, a public service such as obtaining a business license required two weeks. Indications are that these can now be approved in three days. The newly launched code of conduct by the Palestinian Authority should also facilitate an increase in local accountability.

And what next?
Municipalities will continue to play a significant role improving the quality of life for all Palestinians. As a first priority, municipalities must work towards improving their coverage of services. To improve coverage requires financing so a focus on ensuring their financial sustainability is also key. As challenges are identified, development partners in the sector are prepared to assist in achieving the common goals to enable Palestinian municipalities to contribute to better living conditions for Palestinian citizens.

Courtesy of the Donor Group on Municipal Development and Local Government

*Belgium, Denmark, France/AFD, Germany (GIZ/KfW), Sweden, the World Bank, and the PA.

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