Responsibility with Accountability: A FAIR Governance Framework for Performance Accountability of Local Governments

Abstract

This paper focuses on the role of local governments in bringing about fair, accountable, incorruptible and responsive (FAIR) governance. Local governments around the world have done important innovations to earn the trust of their residents and their comparative performance is of great interest yet a comprehensive framework to provide such benchmarking is not available. This paper attempts to fill this void, by developing a general framework for performance accountability of local governments and by relating real world practices to aspects of this framework. The proposed rating framework requires several types of assessments: (a) their compliance with due process and law; (b) monitoring of fiscal health for sustainability; (c) monitoring of service delivery; and (d) citizens’ satisfaction with local services. The approach yields key indicators useful for benchmarking performance that can be used in self-evaluation and improvement of performance. From an analysis of practices in local government performance monitoring and evaluation, the paper concludes that ad hoc ad-on self standing monitoring and evaluation systems are more costly and less useful than built-in tools and mechanisms for government transparency, self-evaluation and citizen based accountability such as local government output budgeting and output based fiscal transfers to finance local services.

Keywords: local government, responsibility, accountability, theory, practice, performance

JEL Classification: H11, H72, H75, H76, H79