New functions and monitoring of performance indicators for LGUs

The workshop organised by dldp in cooperation with the Ministry of Finance aimed the preparation and implementation of an instruction for the monitoring of performance indicators for the new functions transferred to LGUs.

A workshop on definition of performance indicators for the new functions transferred to local governments has been organized by dldp and Ministry of Finances on January 18th, 2017. More than 30 people from Ministry of Finance, Ministry of Interior, Ministry of Environment, Ministry covering Social Affairs, National Agency for Territorial Reform Implementation, Municipalities of Shkodër, Durrës, and Lezhë, and from STAR project participated in this event.

Decentralization and Local Government Program supports the Municipalities in the north of Albania, for strengthening their capacities and providing improved services to citizens. In this frame dldp has been engaged since several years in dealing with issues of Public Finance Management at the local level, by contributing significantly as well in the national regulatory framework (decentralization strategy, organic law of local self-government, territorial and administrative reform, etc.), including institutional support at national level. 

As of January 1st, 2016, six new functions were decentralized from Ministries of Line to the local level, along with human and financial resources and assets. The transfer process has been accompanied by a number of issues. Following a request from Ministry of Finance, in 2016, dldp engaged in preparing a method for function allocation monitoring. Dldp prepared and then implemented the methodology for the monitoring of the preparedness of LG to receive the new functions. Final report was handed over to Ministry of Finance. The process involved three pilot Municipalities: Shkodër, Lezhë and Durrës, (dldp partners) and Ministries of Line.

In 2017, Ministry of Finance has requested dldp to continue with function monitoring exercise. The aim is to provide adequate insight for MoF for calculating the specific transfer made to Municipalities in order to implement the new functions. Specifically there has been requested a set of performance indicators, which would provide data on how Municipalities have performed functions. National and international dldp experts have compiled a preliminary set of performance indicators based on the indicators used by Ministries of Lines to measure their performance in the frame of the Medium Term Budget document, which were presented to the participants in the event. Discussion aimed to identify the most suitable performance indicators and the availability of data for measuring these indicators. All participants agreed that such set of indicators should come as an instruction from MoF, so that Municipalities could respond with appropriate engagement. It was stressed the necessity to involve Ministries of Line that have decentralized the new functions in providing necessary data which would help to establish a baseline for measuring the progress through the agreed performance indicators.

At the end of the meeting it was agreed with dldp and MoF on the follow up steps so that an instruction from Ministry of Finance could be prepared and issued within February 2017.