CIVIL SERVICE INSTITUTE

NAME: farhia Mohammed Yussuf

Class:B
ID:1910
Course:Introduction To Public Administration
Department: Developing Management
Submission: 09/April/2016
Assignment: 2

Introduction to Decentralization
Decentralization is the transfer of authority and responsibility for public
functions from the central government to intermediate and local
governments or quasi-independent government organizations and/or the
private sector.
Decentralization is the process of redistributing or dispersing functions,
powers, people or things away from a central location or authority.
Government decentralization has both political and administrative aspects.
Its decentralization may be territorial, moving power from a central city to
other localities, and it may be functional, moving decision-making from the
top administrator of any branch of government to lower level officials, or
divesting of the function entirely through privatization.
Deconcentration, the weakest form of decentralization, shifts responsibility
for decision-making, finance and implementation of certain public functions
from officials of central governments to those in existing districts or, if
necessary, new ones under direct control of the central government.
Delegation passes down responsibility for decision-making finance and
implementation of certain public functions to semi-autonomous organizations
not wholly controlled by the central government, but ultimately accountable
to it. It involves the creation of public-private enterprises or corporations, or
of "authorities", special projects or service districts. All of them will have a
great deal of decision-making discretion and they may be exempt from civil
service requirements and may be permitted to charge users for services.
Devolution transfers all responsibility for decision-making, finance and
implementation of certain public functions to the sub-national level, such as
a regional, local, or state government.
Divestment, also called privatization, may mean merely contracting out
services to private companies. Or it may mean relinquishing totally all
responsibility for decision-making, finance and implementation of certain
public functions. Facilities will be sold off, workers transferred or fired and
private companies or non-for-profit organizations allowed to provide the
services Many of these functions originally were done by private individuals,
companies, or associations and later taken over by the government, either
directly, or by regulating out of business entities this competed with newly
created government programs.

Meaning of Decentralization

Decentralization means decentralizing revenue raising and/or expenditure of

moneys to a lower level of government. decentralization can be achieved
through user fees, user participation through monetary or labor
contributions, expansion of local property or sales taxes, intergovernmental
transfers of central government tax monies to local governments
through transfer payments or grants, and authorization of municipal
borrowing with national government loan guarantees. Transfers of money
may be given conditionally with instructions or unconditionally without them.

Definition of Decentralization
According to Louis Allen, "decentralisation refers to the systematic
effort to delegate to the lowest levels all authority except that which can only
be exercised at central point."
According to Henry Fayol, "Everything that goes to increase the
importance of the subordinates role is decentralisation, everything that goes
to reduce it is centralisation
This definition makes it clear that even in decentralisation; delegation to the
lowest levels is not complete as the basic functions in the management
process are centralized.
Is the process of redistributing or dispersing functions, powers, people or thi
ngs awayfrom a central location or authority. Decentralization, or
decentralizing governance, refers to the restructuring or reorganization of
authority so that there is a system of co-responsibility between institutions of
governance at the central, regional and local levels according to the principle
of subsidiarity, thus increasing the overall quality and effectiveness of the
system of governance, while increasing the authority and capacities of subnational levels. Decentralization could also be expected to contribute to
key elements of good governance, such as increasing people's opportunities
for participation in economic, social and political decisions; assisting in
developing people's capacities; and enhancing government responsiveness,
transparency and accountability.

Importance of Decentralization

Develop managerial talent for future:

In the decentralization managers working at lower and middle level also

learn the art of making decisions. They get the experience of performing
activities of top executives and learn to manage the authority given to them.

So decentralization process prepares the managers working at lower and

middle level to perform the task of top level. So, whenever there is vacant
job position at top level management, the managers working at lower or
middle level can be promoted.

Facilitates growth:

Decentralization grants more autonomy or freedom to lower level. This helps

the subordinates to do the work in the manner best suited for their
department. When each department is doing to their best then productivity
increases and it will generate more revenue which can be used for
expansion.

Promotes initiative and creativity:

When lower and middle level executives are performing the task of top level
executives then it brings creativity. On the other hand, the initiative directly
depends on the authority. When the employees at every level are given
greater degree of autonomy and authority according to their responsibilities,
this helps them to take initiative.

Better control:

In decentralisation employees working at different levels take their own

decisions and they are personally accountable for their decisions, they
cannot pass the blame to their superiors. With decentralisation better control
can be exercised through Score Card, Management Information System,

Improved team work:

In decentralisation all the managers and employees are sharing the decisionmaking powers; all are given some kind of autonomy and freedom of action.
This sharing of decision and freedom of action integrate the employees as
one team and develop team spirit among the employees.

Relief to top level management:

In the process of decentralisation top level managers are not overburdened

with the responsibilities and authority as they systematically pass the
authority and responsibilities at different levels and they become free to
concentrate on core and important issues.

Quick decision-making:

In the decentralisation process decision-making is not restricted in few hands

only but decision-making power is entrusted to all the managers who are
taking actions or performing the activities. This leads to faster decision

because employees who have to perform the activities are allowed to take
decision also.

Develop initiative among subordinates:

Passing of authority at middle and lower level shows the trust and faith of top
level in their subordinates and this trust and faith motivate the employees
working at different levels as they are allowed to take decisions without
seeking the approval of superior.

Decentralisation helps to improve the quality of

decisions/decision-making at the top level management.
Decentralisation of authority among other executives at all levels in
the Organisation relieves the top executive of the excessive burden
saving his valuable time, which he can devote to more important and
long-term problems. This is bound to improve the quality of his
decisions regarding such problems.
Decentralisation encourages development of managerial
personnel. Most companies find lack of managerial talent as a limiting
factor in their growth. A company cannot expand effectively beyond
the scope and abilities of its managerial personnel. Capable managers,
however, can be developed only by giving managerial jobs to suitable
persons and delegating them the authority to make important
decisions. Such wide exposure gives them opportunity to grow and to
have self-development for higher positions. The more talented and
capable persons will learn and improve and qualify themselves for
higher managerial positions. Only a decentralized Organisation can
offer such opportunities to future managers without involving
additional expenditure A decentralized Organisation also allows its
managers adequate freedom to try new ideas, methods or techniques.
In brief, decentralisation creates a team of competent managers at the
disposal of the company.
Decentralisation makes decision-making quicker and better.
Since decisions do not have to be referred up through the hierarchy,
quicker and better decisions at lower levels can be taken. Divisional
heads are motivated to make such decisions that will create the
maximum profit because they are held responsible for the effect of
their decisions on profits. Thus decentralisation facilitates quick and
result-oriented decisions by concerned persons.
Decentralisation provides opportunity to learn by doing.
Decentralisation provides a positive climate where there is freedom to
make decisions, freedom to use judgment and freedom to act. It gives
practical training to middle level managers and facilitates
management development at the enterprise level.
Decentralisation improves motivation.

Research conducted by social scientists has proved that the

Organisation structure itself exercises some influence on the
motivation of the people working within it. An Organisation structure
which facilitates delegation, communication and participation also
provides greater motivation to its managers for higher productivity.
Decentralized Organisation structure is most favorable for raising the
morale and motivation of subordinates which is visible through better
work performance.
Decentralisation facilitates diversification of activities .
It is a matter of common experience that an Organisation with
departmentation on the basis of products facilitates diversification of
products or market even when the authority is centralized.
Decentralisation takes this process a step further. Managers of semiautonomous product divisions are able to utilise their skills and
experienced judgment. This has a bearing on their products and the
market. The enterprise also attains maximum possible growth.
Decentralisation is beneficial when new product lines or new activities
are introduced in an Organisation. Such policy creates self sufficient
units .

Limitation of Decentralisation

1. Decentralisation is costly as it raises administrative expenses on

account of requirement of trained personnel to accept authority at
lower levels. Even the services of such highly paid manpower may not
be utilised fully, particularly in small organisations.
2. Decentralisation may lead to inconsistencies (i.e. absence of
uniformity) at the Organisation level. For example, uniform policies or
procedures may not be followed for the same type of work in different
divisions.
3. Decentralisation may lead to the problem of co-ordination at the level
of an enterprise as the decision-making authority is not concentrated.
4. Introduction of decentralisation may be difficult or may not be
practicable in small concerns where product lines are not broad enough
for the creation of autonomous units for administrative purposes.

Challenges of Decentralisation in Somaliland

The challenges that Somaliland are presently facing are countless and
complex in nature. They include capacity concerns, limited resources, overstaffing and service delivery issues. In the coming paragraphs, we will be
looking at these challenges and try to come up with solutions to resolve
these observed deficiencies.
Service Delivery Issues

By 8 law, local governments are mandated to provide the following public

goods and services: establishment and maintenance of roads within the
towns of the district- including sidewalks, street lights, and street drainage
system, construction of water reservoirs in towns and villages, construction
and management of primary schools, construction and management of
centers for the care of the mother and the child, physical planning of the
settlements of the districts and registration of the immovable property, solid
waste collection and disposal, food and livestock markets, slaughterhouses,
management of self-help projects, registration and maintenance of civil
register, and issuing business licenses, among others.
Conflicting Legal Framework
Though a good number of the necessary and relevant laws were developed
and enacted, yet there is a great need to harmonize these different laws that
affect local governance. For instance, there is no clear distinction about
which taxes should be collected by the central government and by the local
governments. To make matters worse, borders of the new districts are not
delineated and, therefore, taxation dispute arises between the districts. A
taxation unification law was enacted but it is not functional in all districts, as
many districts develop thei ir tariffs as stipulated in the local government
law. In addition, the main local government law has only been partially
implemented, due to the substantial fiscal disparities between districts. A
number of 11sector ministries are currently in the process or revisiting sector
policies and acts. However, it is not carried out in a coherent manner
Overstaffing and Ambiguity of Roles and Responsibilities
Almost every local government is overstaffed, as one can conclude from a
simple glance at payroll sheets. They employ and, in some circumstances,
are pressurized to hire a large number of staff despite their limited sources of
revenue and functions. The high rate of unemployment is a national issue,
but the management approach of most of the local governments has
aggravated the situation whereby every mayor, unilaterally and without
proper job analysis, employs a number of unnecessary staff. Above all, a
large number of local government staff members are ghost employees,
just appearing in the payroll sheets, but actually never reporting for work.
Limited Resources
The availability of adequate resources is understandably a paramount
concern in almost every institution and local governments are not
exceptions. Despite the fact that grade A districts can be regarded not o only
solvent but some of them are relatively well off, the vast majority (grades B,
C&D) do not generate sufficient revenues to cover operational costs and
provide social services. If one could closely look at local governments

budgets, the inevitable finding would be that revenue collection is very low in
all of them and, to make matters worse, most of the generated revenues are
used just to cover operational costs.

Lack of community consultation.

Lack of community awareness.
Lack of community monitory group.
Unbalanced of resourse and imperatives.

Recommendation
Civil Service Reform and Development of Human Resource Policy
Civil service reform is critical if Somaliland wants to build a cad
Civil Service Reform and Development of Human Resource Policy Civil
service reform is critical if Somaliland wants to build a cadre of motivated
professionals who can provide the mandated service delivery. The
development of a comprehensive human resource policy - to address the key
gaps identified related to human resource management issues - could be the
first step towards that reform. The current practice is that staff at local
governments does not have even terms of references let alone a human
resource policy that guides the recruitment process, promotion, staff
training, as well as retirement schemes. In the absence of such a policy, it
will be difficult to seriously address the said issues. The policy will also guide
the different steps of the recruitment process and will eliminate the everincreasing recruitment without considering the needs on the ground. More
importantly, it will advise the best way of undertaking staff right-sizing and
the elimination of ghost employees, while taking into account local
government development priorities and resource constraints. As an
immediate intervention, however, terms of references for each staff should
be developed by local governments, and close supervision and monitoring
mechanism must be put in place.
Creation of a Local Government Award.
The introduction of a Local Government Award will create healthy
competition among the local governments in the country. Once formed and
pertinent information adequately disseminated, the concerned parties will
surely compete in relation to greater service delivery, better management of
waste, installation of street lightings, and the invention of better strategies
for poverty reduction. The introduction of a meaningful and valuable award
with transparent eligibility criteria will hopefully serve as a watershed
between two eras: the end of the era of internal power struggle and
greediness and the beginning of the era of delivery of greater services, and
the implementation of more development projects with greater public
participation. The proposed award have a yearly changing theme such as

waste management, roads improvement, flood protection, local economic

development, etc. Studies have suggested, for instance in Rwanda when a
Local Governments Innovation Competition was introduced, that such an
award scheme can completely rejuvenate the subnational structures and
promote a healthier competitive spirit, replacing the struggle over the
meagre available resources. In Rwanda it also proved to be a great way to
build the capacity of local governments. Somaliland could also do the same!

Revenue Collection and Budgeting Improved

Improved Service Delivery
Improved Oversight Role of the Central Government
Legal Framework Harmonized

Reference
www.google search
www.wikipedia
http://blog.commlabindia.com
and my mind