Ampasy Nahampoana is a small municipality with a population of less than 10,000 located near the port of Tolanaro. Participatory budgeting was introduced in 2008 in order to re-establish decentralization and combat government corruption.
Problems and Purpose
Participatory budgeting was introduced to Madagascar by the World Bank in an attempt to reestablish a decentralisation scheme it had encouraged in the 2000’s to no avail. Ampasy Nahampoa was one of the municipalities where it was originally used, although it has now spread to other regions and is no longer exclusively financed by the World Bank. On the national level, it was used as a tool designed to create more governmental transparency as a direct response to criticisms of corruption. The direct engagement of the citizenry in participatory budgeting gave the government, and the policies produced by it, greater legitimacy.
For Ampasy Nahampoa specifically, participatory budgeting was implemented in order to generate greater transparency for mining revenues. This had become a contentious issue as a result of the mining company Rio Tinto-QMM distributing mining royalties. This resulted in it having more resources compared with other regions in Madagascar. Although, by international standards, it still suffered with poverty. The arrival of the mining company Rio Tinto-QMM in 2008 meant there was a demand for modified governance, given that the local finances had increased significantly from an annual amount of $6 to $400. A result of these mining royalties was an increase in regional budget. This created the need for better ways to manage revenues and the involvement of the locals in order to safeguard where finances were directed.
The introduction of participatory budgeting sought to optimise citizen participation in budgeting outcomes, the realisation of initiatives and the diversification of the distribution of finances across the region. As a result of this participation, the government aimed to increase tax revenue and to reduce the dependency on mining as a source of income, in favour of more sustainable ones. The purpose of the introduction of participatory budgeting was to improve the way governance practices were perceived, and to ensure transparency and social responsibility.
Background History and Context
Madagascar is a country that, in recent history, has experienced serious political and economic hardships. Located in the South Indian Ocean, it is one of the poorest countries in the world, irrespective of its large resource endowment. It has seen both periods of economic growth and fall, experiencing both record highs (9.85% in 1979) and record lows (-12.70% in 2002) in GDP. Ampasy Nahampoana is a small municipality with a population of less than 10,000 located near the port of Tolanaro. Participatory budgeting was introduced to it in 2008. This region has the power of self governance granted by federal laws, to which it is still subordinate to.
Madagascar became independent from France in the 1960’s, and with its sovereignty it also inherited a profound ethnic division that can still be observed in Malagasy politics. Following the violent removal of President Ravalomanana from office in 2009, a defector transition government led by President Rajoelina held power for 5 years. This bought about the recognition of the fundamental role civil society plays in shaping the political landscape. It was during President Rajoelina's tenure that participatory budgeting was introduced to Ampasy Nahampoa. Prior to its political crisis, the Madagascan economy had seen much economic development, reaching an annual growth rate of 5.7% in the early 2000’s. There is speculation that this is due to the government jettisoning socialist economic policies. The constitution and legislature have been criticised for being a tool, rather than a constraint of executive power. The Church also faces international scrutiny for not maintaining independence from the state.
Ampasy and the surrounding area comprises one of the most poor regions of Madagascar. In the regions capital, Talognaro, 90% of the population don’t have access to potable water, compared to the national statistic of 46% in urban areas. Of the children appropriately aged to attend school, 74% of them do not. In 2007, the immediate year before participatory budgeting was introduced, 76% of those living in the rural areas were found to be living below the poverty line.
The increase of mining revenues in Ampasy Nahampoa raised concerns that the accountability of the Malagasy state to its citizens would be weakened. This led to calls for greater transparency in its revenue collection. The Madagascan government applied to join the Extractive Industries Transparency Initiative (EITI) after receiving societal pressure to do so. Despite the governments initial inertia, Madagascar received validation from the EITI In 2017. The most recent EITI (2018) disclosures report that Madagascar received (USD) 192 million from extractive industry taxation, with this sector contributing to 2.1% of the countries GDP- a significant increase from 0.7% in 2012.
The link graphically demonstrates the increase in Malagasy Government revenue, as a result of Rio Tinto and the Ambatovy mining project: https://eiti.org/madagascar
The mining sector in Ampasy Nahampoa received even more of a boost from large scale investments. QMM, who is owned by Rio Tinto and OMNIS - a branch of the government, invested 1 billion into mining and began its production in 2009. While Sherritt International, invested 4 billion and began mining in 2011.. These figures demonstrate the need for the citizenry to be actively involved in local projects, and thus the demand for participatory budgeting.
Organizing, Supporting, and Funding Entities
The initial participatory budgeting project was financed by the World Bank. It came about as a way to decentralise the Malagasy government. The Recipient Executed Trust Fund (RETF) Grant was the budget used for the implementation of participatory budgeting. The Global Partnership for Social Accountability (GPSA), housed within the World Bank, is the source of the grant. The implementation of this project was estimated to cost the GPSA (USD) $7000,00. The World Bank promised to donate USD$20,00 on an annual basis in addition to this.
The project was coordinated by the non governmental organisation, SAHA. It was organised in 2011 with the purpose of giving help to local governments and small organisations. SAHA had overseen the implementation of participatory budgeting numerous times. It is a rural development program, financed by the Swiss Agency for Development and Cooperation.
Participant Recruitment and Selection
In each meeting, there were an estimated 150 participants, where everyone was given the opportunity to talk. The 15 general assemblies each had elected delegates as members.
Methods and Tools Used
For the purposes of this research, participatory budgeting is defined as a process of direct democracy, universal and voluntary, through which the population can discuss and define the public budget and policies.
What Went On: Process, Interaction, and Participation
There were 15 general assemblies in each village, with input from NGO’s and different political parties. The assemblies were comprised of elected delegates. Investigators who promised anonymity discussed contentious issues with the community, such as the water quality which was linked to QMM’s behaviour. They reported this back through the local government. Delegates of each core of the municipality discussed with the directors of the city the most favoured programmes as decided by the assemblies. Following this, the participants finalised the budget proposals. This involved estimating the cost of various initiatives with a meeting with the mayor of Ampasy Nahampoa. The budget was then audited by the technical support team, and the proposed project was given to the council people for deliberation. The Chief of Circumscription, a government body, was in charge of the legality of the project. The budget was then publicised on information boards across the region. Before the budget was implemented, it had to have first been approved by the district responsible, so as to ensure equality control. Citizen commissions oversaw the implementation of the projects.
Influence, Outcomes, and Effects
As a result of participatory budgeting being implemented in Ampasy Nahampoa, the Malagasy government expanded the project to 159 municipalities in 2011, using the Local Development Fund. In 2013, the project was increased to include 104 more regions. Since this, some of those municipalities have continued participatory budgeting, financed by their own budget. For instance, Antanarivo allocated 20% of its budget to the continuation of participatory budgeting. Previous to the implementation of participatory budgeting, the revenue collected by the government within this region equated to the fixed costs of the city. Since the application of participatory budgeting this has improved, with cities such as Ambalavo collection revenue increasing by 44%. As a consequence of public interaction, half of the funding in Ampasy Nahampoa was allocated towards projects providing basic services such as sanitation, solid waste collection, public transport and electricity. The rest was directed towards infrastructure that boosted local development such as district health facilities, educational facilities and parks. There was a trend of the citizenry prioritising projects which provided basic services, making participatory budgeting an impressive tool for those involved at the local level.
An outcome of participatory budgeting in the Ampasy region has been the institutionalisation of societal governance. This has arguably led to the balance of power being shifted in favour of the citizens and previously marginalised members of society. An average of 3% of citizens attended the various regional assemblies, which is a relatively high level of participation in comparison to other states that employ participatory budgeting.
Projects that have been implemented as a direct result of participatory budgeting include the building of basic infrastructures such as primary schools, colleges, clinics, toilets and improvements to the water supply. There have also been several projects implemented aimed at increasing the economy of Ampasy Nahampoa, including the building of a hydraulic dam and improvements made to the public transport system. Holman (2017) reported that there were good levels of citizen involvement. This meant that the projects were overseen and held accountable by people who had campaigned for them.
Members who were involved in the participatory budgeting scheme reported that it had increased confidence and that it led to a ‘social inversion’ and economic development that decreased dependence on mining revenues, thus achieving the projects objectives.
Analysis and Lessons Learned
Participatory budgeting in Ampasy Nahampoa demonstrated that a more engaged population are willing to financially contribute to the application of their projects. It has led to the modernisation of governance, which was fundamental in not only establishing participation, but also in the delivery of the projects. There was a need for this, as the pressure to respond to the community became greater, as a direct result of participatory budgeting.
There have been several criticisms made against how participatory budgeting was implemented within the Ampasy region. The prevailing argument being that due to the voluntary nature of the assemblies, those who were involved in them were most likely already politically active anyway. Meaning that the project failed to capture the engagement of the politically ambivalent. Therefore it cannot be said that the outcomes of the assemblies were reflective of the interests of the community of Ampasy Nahampoa as a whole. There was also no official quotas aimed at ensuring the diversity of the delegates. This makes the project as a whole vulnerable to the criticism that it gave legitimacy to a process that advanced the interests of the socially powerful under the pretense of equal participation. This makes it difficult to verify whether the project achieved its aim of politically engaging the community, or whether it simply reinforced the power of those who had always been politically active.
On the national level, Smith, Shepherd and Dorward (2012) have argued that a democratic deficit persists in spite of the introduction of participatory budgeting to communities. This is on the basis that stakeholder representatives are manipulated, and as a consequence corruption still exists. If, however, the purpose of participatory budgeting is aimed more at the delivery of services than it is at overcoming problematic power relations. Participatory budgeting in Ampasy Nahampoa has drastically improved the provision of basic services and the management of community projects which have been cost efficient as a result of community engagement. Despite enhancing governance and the delivery of services, the altering of power relations between government and citizen is yet to be established.
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