KARACHI, Oct 19: The issues of political interference in development works, lack of financial autonomy and administrative control over the staff in local government dominated the proceedings of a seminar held at a local hotel on Tuesday.

The seminar was organized by the finance department to discuss the three-year study report on "Devolution in Pakistan" published by the World Bank, Asian Development Bank and the UK's Department for International Development. Senior Minister Finance Syed Sardar Ahmed presided over the seminar.

The panelists at the seminar included chief minister's adviser on local government Waseem Akhtar, additional chief secretary for planning and development Sarwar Khero, National Reconstruction Bureau's representative Inamul Haque, Hyderabad Nazim Makhdoom Khaliq-uz-Zaman, and research economist Asad Saeed.

Referring to the report, Syed Sardar Ahmed pointed out that property and entertainment tax had already been devolved to district governments. He said that instead of piecemeal transfers, the entire budgetary allocation would be transferred to the district government from January 2005 onwards.

He conceded of resistance by federal government, provincial government and bureaucracy in implementation of devolution system and said that there were many who had yet to reconciled with the idea that the powers which were being executed by them were devolved to district, town and tehsil levels.

About NFC award, he said, the issue would be resolved this year on the basis of multiple criteria. "A few problems lie at the bottom which can be overcome with maximum participation of people," he added.

The minister also pointed out that there seemed lack of will at the district level to improve performance of the institutions under its control. In this connection, he gave the example of district hospitals where the district government could not deliver much.

Waseem Akhtar did not agree with some of the observations made in the report. He said that some issues still persisted in many departments primarily due to ambiguity about exercise of powers by the provincial and district governments and financial executive authority. However, both the issues were already under consideration and were taken up with the NRB for its solution, he added.

Sarwar Khero said that devolution from provinces to districts resulted in many difficulties. However, he said that during thelast three years hardly any problem was faced owing to devolution from centre to the provinces.

He also pointed out some planning and financial problems for want of trained manpower. He said that though the government had provided the staff there was still need for creating proper cadre.

Inamul Haque said that NRB recommendations which were submitted for approval of President Musharraf would help overcome implementation difficulties.

Makhdoom Khaleeq-uz-Zaman said that the district governments had not been given powers particularly in health and education sectors, as everything was being controlled by the director-general health and education department.

About the election process, he expressed concern that the assembly elections were held on party basis while local government polls were so-called on non-party basis. He said that a number of problems had been caused due to such difference. He suggested that either all elections should be held on party basis or without party affiliations for smooth functioning of the system.

He also proposed that National Reconstruction Bureau chairman should be a neutral person and the senior most nazim should be made its deputy chairman.

He further suggested that after every three months the chief minister should hold joint meeting of cabinet and nazims for close interaction and coordination.

The report, based on empirical research in six districts and two tehsils in each district, was presented by Nick Manning and Zahid Hussain of the World Bank. The report finds the evidence of genuine change particularly in the opportunities that citizens had gained to make their concerns heard. At the same time, the assessment shows many entrenched practices and attitudes still impeded efforts to meet those concerns with sustained, effective action.

The report also provides extensive recommendations for further action to give devolution greater momentum and impact than it has so far achieved.

"Shifts in responsibilities and resources can also bring improved fiscal efficiency in provincial government, but, much of the momentum for such progress will have to come from further devolution with additional transfers of authority from the federal government to the provinces and from the provinces to the districts," the report states.

It was observed that nazims needed more than public backing. They must have reliable sources of revenue and the ability- often absent at the district level- not only to hire and fire staff but even to make regular, actionable evaluations of the performance of administrative staff and service providers, the report suggested.

Highlighting the salient points of the report, the World Bank representative said that it was based on an empirical study ofsix districts and 12 TMOs, which evaluated the extent to which the new structure had succeeded in creating the incentives necessary for local governments to achieve at least some of the service delivery objectives.

The study suggests that devolution would be providing district and tehsil nazims with greater incentives for efficiency in fiscal management if it achieved positive movement in three key categories:

* Budgetary certainty - the degree to which they must live within hard constraints and the predictability of the budgetary transfers that they depended on.

* Autonomy in preparing the budget - specifically the development, the non-salary recurrent and the salary budgets.

* Incentives for local revenue - raising the buoyancy and potency of taxes assigned, the clarity of revenue assignments and other incentives for revenue raising.

The report also reveals that local governments have limited autonomy in preparing their budgets. More than half of the ADP in districts are usually under the effective control of federal or provincial agencies.

It states that the local governments are highly dependent on inter-governmental fiscal transfers. This degree of vertical imbalance can lead to inefficiencies at both levels. It also creates incentives for local governments to overspend.

The study terms managerial power over service providers weak and observes that administrative devolution as such remains incomplete. It states that the transfer of functions and physical relocation of staff have not been fully matched by the transfer of the employer's role.

It states that the sophisticated sharing of control over postings of civil servants based on norms showed that although physically located in the districts, most senior district staff do not consider themselves as district employees and therefore are likely to accommodate provincial pressures to transfer subordinate staff.

This attitude has considerably weakened the accountability of senior staff to local elected representatives. In fact, politically motivated inter and intra district staff transfers is the main area of conflict between provincial and local governments and are most severe in districts that are not politically aligned with the province.

The local government system provides for a number of institutional arrangements - monitoring committees and district safety commissions for the oversight of service providers by elected representatives. However, it is observed that such mechanisms have either not been established or have been introduced to a limited degree.