Country Report on Local Government Systems- Sri Lanka

8/7/2019 Country Report on Local Government Systems- Sri Lanka

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Country Reports on Local Government Systems:Sri Lanka

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Sri Lanka______________________________________________

1. BRIEF DESCRIPTION OF THE COUNTRY

1.1 Socio economic profile

Sri Lanka, an island located in the Indian Ocean, has a land area of 62,705 sq.km. (excluding inland waters). Sri Lankas maritime waters extend up to 489,000 sq.km. The central mountainous region, which rises to an elevation of 2,524 metres, isthe source of the countrys major rivers.

As indicated in Table 1, the population is a little over 19 million with a

population growth rate of 1.5 per cent. The Western Province has the highestpopulation size and density. This is followed by the Central and the SouthernProvinces. The North Central Province has the highest land area, followed by theEastern and Uva Provinces. According to the 2002 Central Bank statistics, thesectoral population is 72.2 per cent rural, 21.5 per cent urban and 6.3 per centestate.

During the last 40 to 50 years, the worldwide urban migration has also beenobserved in Sri Lanka. This trend has degraded the city environment and threatenedeconomic efficiency, social equity and urban sustainability. These consequencesare experienced in their worst form in Colombo and its suburbs, where settlements

have degraded to a very low level. Since most of these settlements are illegallyoccupied, even local authorities and the previously mentioned stakeholderorganisations have not been able to upgrade these urban low-income settlements.

As depicted in Table 2, the highest contribution towards the economy is from

the Western province followed by the North Western Province. In 2001, for the firsttime since Independence, a negative growth of 1.5 percent of GDP was recorded, asshown in Table 3. A positive growth was experienced in the year 2002. Inflation roseat 14.2 percent. It has declined to 9.6 percent by 2002.

The national debt, which was contained at Rs. 550 billion in 1994 (Rs. 49.98

per US$), increased dramatically to Rs. 1450 billion by 2001. At present, debtequals 105 per cent of GDP. In 2002, debt interest servicing alone has cost theGovernment Rs. 118 billion, and Sri Lanka had to repay loan instalments of Rs. 38billion in foreign debt and Rs. 130 billion in domestic debt. Debt service paymentsamounted to Rs. 285 billion, compared to Government revenues of Rs. 262 billion.Unless this mountain of public debt is reduced, there will be no resources fordevelopment activities. This is arguably the most intractable of the economicmanagement problems that the government has to grapple with.


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Table 1: Population and land area by province and population density

Population (Mid-Year) 000 (a) 19,007

Land Area (Excluding Inland Waters) Sq. Km. 62,705

Population and Land Area by ProvincesProvince Population (a) Land Area Density of

000 (Sq. km.) Population

Western 5,412 3,593 1,506

Central 2,443 5,575 438

Southern 2,299 5,383 427

North-Western 2,174 7,506 290

Sabaragamuwa 1,804 4,921 367

Northern 1,094 8,290 132

Eastern 1,476 9,361 158

Uva 1,188 8,335 143

North-Central 1,117 9,741 115

Total 19,007

62,705 303

Composition of Population (1981 Census) (b)

By Ethnicity per cent By Religion %Sinhalese 74.0 Buddhists 69.3

Sri Lankan Tamils 12.6 Hindus 15.5

Indian Tamils 5.5 Muslims 7.5

Moors 7.1 Christians 7.6

Others 0.8

Others 0.1

By Sector %Rural 72.2 Urban 21.5 Estate 6.3

(a) Provisional

(b) Data refer to population census-1981 as comparative data based onCensus of Population and Housing-2001 are yet to be estimated.

(c) Calculated by the Central Bank using mid-year population estimates

Received from DCS

(d) 3rd quarter 2002

Substantial changes have taken place in the structure of employment

opportunities open to the rural labour force. The number working in modern industryhas expanded, mainly in the free trade zones or other urban/semi-urban industrialareas. In addition, as a result of the deliberate policy, adopted by the governmentafter 1989 of spatial dispersion of factory industry, the local rural factory work hasalso increased. Another significant aspect of todays rural life is that many ofvillagers work abroad a phenomenon that developed after the oil shocks of the1970s.


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Table 2: Provincial GDP (at current factor cost prices)

shares and growth (a)

Province / Year 1996 1997 1998 1999 2000 2001 GDP2001 Per Capita

GDP(Rs) 2001Western (WP) 43.7 44.3 45.3 48.7 49.3 47.3 589,478 109,953

N. Western (NWP) 11.3 12.1 12.0 10.4 10.4 10.9 135,494 62,795

Central (CP) 10.0 10.5 9.8 9.2 9.4 9.8 121,414 50,275

Southern (SP) 9.0 8.8 9.3 9.6 9.4 9.9 123,180 54,095

Sabaragamuwa(SaP)

9.0 7.6 6.7 6.4 6.7 6.3 78,596 43,958

Eastern (EP) 4.8 5.0 5.5 5.0 4.5 5.0 63,404 44,780

Uva (UP) 5.1 5.0 4.9 4.1 3.9 4.5 56,469 48,231

N. Central (NCP) 4.6 4.0 3.6 4.1 3.9 3.8 47,080 42,579

Northern (NP) 2.4 2.8 2.9 2.5 2.2 2.5 30,582 29,384

National GDP 100 100 100 100 100 100 1,245,703 66,500

Region SHARES GrowthRate

(b) 1996 - 2001

H 43.7 44.3 45.3 48.7 49.6 47.3 14.2

M 39.4 39.0 37.8 35.5 35.9 36.8 10.9

L 16.9 16.7 16.9 15.8 14.5 15.9 11.2

National GDP 100 100 100 100 100 100 12.4(a) Provisional (b) Average Annual Growth Rate

H High Contributor (WP) M Medium Contributor (SP,SaP,CP,NWP) L - Low Contributor(UP,EP,NCP,NP)

Source: Central Bank of Sri Lanka

The female contribution to national income is clearly becoming more diversified,

and in many respects more significant. The pattern of employment in export-oriented manufacturing industry, particularly in free trade zones, is preponderantlybiased in favour of women. In addition, women constitute the bulk of Sri Lankanworkers employed overseas, contributing significantly to both their family incomes

and to the countrys foreign exchange earnings.There was a substantial decline in the crude death rate (6.0 per thousand), and

the infant mortality rate (13.4 per 1,000 live births) for 1999. Life expectancy at birthfor the same year was 72 years. With widespread access to educational facilities, theliteracy rate in 2000 was 93.4 per cent for men and 89.4 percent for women. Theseindicators are comparable to those in many advanced societies. From thecommencement of UNDPs publication of the Human Development Report, SriLanka has been placed among middle human development countries.


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Table 3: Growth of real GDP (per cent) and inflation

1996 1997 1998 1999 2000 2001 2002 (a)

GDP growth (%)6.3 4.7 4.3 6.0 -1.5 4.0

Primary sector (mining,agriculture etc.) % growth (4.2) 3.04 1.9

4.5

2.00

Manufacturing sector% growth 6.5 9.1 6.3

4.4

9.2

Services sector% growth 6.2 7.0 5.2

4.2

6.9

Construction sector% growth 3.4 5.4 7.1

4.8

4.8

Inflation15.9 9.6 9.4 4.7 6.2 14.2 9.6

a) Provisionalb) Per cent change of annual average Consumer Price Index. (1990 = 100)Source: Sri Lanka Socio Economic Data 2003, Central Bank of Sri Lanka June 2003.

Table 4: Gross National Product (market prices)

1990 1996 1997 1998 1999 2000

Gross National Product (GNP)(Mn. US$)

GNP Per Capita (a), US$

7,973

469

13,701

747

14,917

804

15,511

826

15,490

813

16,286

841

a) ProvisionalSource: Sri Lanka Socio Economic Data 2003, Central Bank of Sri Lanka June 2003.

Absolute poverty has continued to prevail as a major social problem in Sri

Lanka. At the census of 2001, the population of 18 districts lying outside the wartorn areas was enumerated as 16.6 million by the Department of Census andStatistics. Out of this population, one-fifth to one-third of the population wasconsidered poor depending on whether one uses a lower (Rs. 860 per person permonth) or upper (Rs. 1032 per person per month) poverty line. In Sri Lanka, povertyis predominantly a rural phenomenon, with 87 per cent of the poor living in the ruralsector. Owing to inadequate income, shelter, sanitation, water and proper wastedisposal facilities, both the urban and rural poor face numerous health hazards.

The most recent policy initiative on poverty alleviation finds expression in Sri

Lanka: A Framework for Poverty Reduction prepared by the External ResourcesDepartment (2000). It proposes a course of action in which the poor increasinglytake advantage of opportunities created in the private sector led market economy.Three major components are highlighted to constitute to the strategic foundation for

poverty reduction: (a) creating opportunities for the poor to participate in economic


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growth; (b) strengthening the social protection system; and (c) empowering the poorand strengthening governance.

The cease-fire agreement signed with the LTTE in 2002 is a historical

milestone for Sri Lanka. Since the agreement, confidence-building measures have

encouraged the free movement of people and goods throughout the country, andrevived inter-province economic activity. Reconstruction work in the affected areasis moving ahead rapidly with donor assistance. The tourist trade is rapidly regainingits earlier prosperity. Defence payments have simultaneously been reduced, pavingthe way for diverting more funds to development related activities.

The economy is expected to record a growth rate of about 5.5 per cent in 2003,reflecting recovery in all major sectors. Improved business confidence, the removalof war risk charges, the discontinuation of power cuts, and progress on the peacefront contribute to these improvements.

1.2 Political and administrative structure

The legal and administrative structure of Sri Lanka is based on its republicanconstitution. The Executive President of the Republic is elected by the people andholds office for a six-year term. The Parliament consists of 196 members elected bythe people and 29 members from the national lists. The President appoints thePrime Minister and the Cabinet of Ministers and is the Head of the Cabinet (Chart 1).

The country is divided into nine provinces for administrative purposes.

However, at present North and East are merged as North/East Provincial Council.

Power has been devolved to the provinces with the unit of devolution being theProvincial Council comprised of members elected by the votes of each province. AGovernor appointed by the President heads the province, while a Chief Ministerappointed from the elected members, heads the Provincial Council.

The establishment of the Provincial Councils (PCs) in 1988 was perceived as

constituting a radical departure from the centralised form of governance Sri Lankahad practised since emerging from colonial rule. With the establishment of the PCsthe administration in the country was decentralised. The assignment ofresponsibilities between the center and the provinces is defined by legislative,executive, fiscal and administrative arrangements. They define the scope and extent

of the assignment of responsibilities to provinces and what has been retained by thecenter.

Under the 13th Amendment to the Constitution, passed on 14 November 1987,

subjects and functions in the purview of central and provincial governments havebeen identified in three scheduled lists. The Central Government retains exclusiveresponsibility only for national policy List 11 (the Reserved List). List 1 is theProvincial Council List. List 111 (Concurrent List) provides the Central Governmentto share responsibility with the Provincial Councils).

Subjects and functions assigned to PCs (List 1) comprise public services

bearing directly on the daily life of the people in the province. This subjectassignment makes the PC the provider of basic services to the community. The


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responsibilities assigned to PCs have been classified as follows. (Gunawardena,1991):1. Public Order, Administration and Provincial Affairs;2. Provincial Planning;

3. Provincial Finance;4. Economic and Social Services;5. Human Resources Development and Community Services;6. Infrastructure, Urban Development and Environment;7. Trade, Commerce and Food Distribution;8. Culture and Sports;9. Regulation of Provincial Activities; and10. Miscellaneous Services.

The central government can set national policies on all subjects and functionsand has the power to approve legislation on the concurrent list of subject areas that

have been listed as provincial subjects in the scheduled list. Its functions include:

National policy formulation; Designing inter-governmental transfers; Establishing and managing centre-province relations; Cadre and staffing; and The administration of home affairs.

The Provincial Governor of each province is responsible for the execution of

policies and statutes made by the provincial council on devolved subjects, through

the Board of Provincial Ministers (Chart 2). A provincial public service has beenconstituted for each province to support the executive. The operations, supervisionof management, including the power to dissolve a local authority, come under thepurview of a Provincial Council. Central governments involvement is limited topolicies on the reform, structure and constitution of local authorities and the nationalpolicy making related to local government.

Although members of Parliament are proportionally elected on a district basis,

there is no House or Assembly at the district level. Out of the three electoralmemberships, i.e. Parliament, Provincial Council and local authority, the first is themost powerful. Although, the term of office for the President is six years, for

Parliament and Provincial Councils it is five years each. For Local Authorities it isfour years with the provision that the Minister could advance the term of office by 12months or extends it by 12 months.


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Chart 1: Structure of the government administration

CHIEF

SECRETARY

PROVINCIAL SECRETARIAT

SECRETARIES

SUBJECT HEADS

GOVERNMENT

AGENT

DIVISIONAL

SECRETARYM

C

U

C

P

S

GRAMA

NILADHARI

COMMUNITY

ORGANISATIONS

PARLIAMENT PRESIDENT

CABINET

MINISTRIES

DEPTS. & CORPS.

GOVERNOR PROVINCIAL

COUNCILS

CHIEF MINISTER

BOARD OF

MINISTERS


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Chart 2: Organization of provincial council administration

The 17th Amendment to the Constitution in 2001 established a Constitutional

Council and five independent commissions; Public Service Commission, PoliceCommission, Election Commission, Judicial Service Commission and Media


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Commission. These five commissions are expected to strengthen democracy in thecountry and guarantee the independence of public service and media.

2. EVOLUTION OF LOCAL GOVERNMENT

Local government has a long history, dating back to the fourth century. The

oldest chronicle of Sri Lanka, Mahawansa (sixth century) mentions that the NagaraGuttike (city Mayor) carried out local administration. Village level organizationscalled Gam Sabhas functioned under village leaders who enjoyed powers toadminister local affairs and also perform judicial functions such as dealing with pettyoffences and reconciling disputes. What is understood, as local government today isan expanded version of such responsibilities, operating under the democratic systemof governance. However, certain functions such as judicial and agrarian serviceshave been taken over by other authorities.

The Gam Sabhas were mainly agriculture oriented and were not directed by the

centre. The British abolished theGam Sabhas in 1818 withdrawing the self-government element in Sri Lankan villages. However, the British resurrected it insome way by the introduction of the Irrigation Ordinance in 1856, which entrusted thevillage communities to take certain actions related to irrigation and cultivation. Thelocal government system in Sri Lanka was greatly influenced by the British duringtheir colonial rule, particularly during the later part of the British rule (form 1865 to1948). Important landmarks in local governance under the British can be summarilystated as follows:

Establishment of municipal councils for the cities of Colombo and Kandy in1865 and for Galle in 1866; Reconstitution of village committees by the Village Committees Ordinance in

1871; Establishment of sanitary boards for small towns in 1892; Establishment of urban councils in 1939; and Establishment of town councils in 1946.

At the time of independence in 1948 the system of local authorities in operation

were municipal councils, town councils and village committees. The villagecommittees functioned as legal entities served by village leaders on a voluntary

basis. During the period 19401980 the term village committee was changed tovillage council. These new councils did not last long due to the inherent defects inthe system that distanced the people from the administration. This necessitated theestablishment ofPradeshiya Sabhas in 1987 under the provision of PradeshyaSabha Act No.15 of 1987. The establishment of 256 Pradeshiya Sabhas in 1987marked an extensive attempt of decentralization andthe DDCs were abolished.

In 1981, town councils and village councils were abolished and the powers and

functions were transferred to newly constituted District Development Councils(DDCs) established under the provision of District Development Councils Act No.35of 1980.


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Under the constitutional amendment it was expected that the provinces wouldprepare and pass Statutes to legally transfer the official activities of the localauthorities. However, this has not taken place; except for a few statutes passed onthe management of local authorities, other major activities are still governed underthe above-mentioned laws.

The observed functions of the local authorities focus more on environmental

management and social services. Roads, sanitation along thoroughfares, health,water supply, solid waste management, sewerage etc are the main functions of localauthorities since their very inception. Other development activities such aseducation, agriculture, employment generation and poverty alleviation are notdirectly considered under these laws.

At present some of these functions have been handed over to some other

government owned boards, corporations or statutory authorities, making the localauthorities dependant on those institutions to serve their electorates. The National

Water Supply and Drainage Board, the Ceylon Electricity Board, the CommonAmenities Board, the National Housing Development Authority and the UrbanDevelopment Authority are some of the organisations owned and managed by theCentral Government, but serving the electorate directly or through local authorities.Thus the Ceylon Electricity Board has taken over electricity supply, NWSD hasdeveloped and administered water supply schemes and UDA and NHD havedeveloped housing schemes for the urban poor.

Since these organisation belong to the central government, their policies,

operational systems and management are undertaken with government interests inmind. Therefore, greater influence is wielded on such organisations by the electedrepresentatives of Parliament than the Mayor or Chairperson of a local authority.

3. MAIN FEATURES AND CHARACTERISTICS OFLOCAL GOVERNMENT

3.1 Local government categories and hierarchies

The organizational structure of local governance consists of three legal

instruments: the Municipal Council Ordinance, the Urban Council Ordinance and thePradeshiya Sabhas Act. At present there are 18 Municpal Councils, 37 UrbanCouncils, and 256 Pradeshiya Sabhas. The number of local authorities in the eightprovinces and the twenty-five districts is given in Table 5 below.

Table 5: Distribution of local authorities in Sri Lanka (2003)

Number of Local AuthoritiesProvince District

MC UC PS Districts Province

Colombo 4 3 5 12Western

Gampaha 2 5 12 19

45


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Number of Local AuthoritiesProvince District

MC UC PS Districts Province

Kalutara - 4 10 14

Kandy 1 4 17 22

Matale 1 - 11 12Central

Nuwara Eliya 1 2 5 8

42

Galle 1 2 15 18

Matara 1 1 12 14Southern

Hambantota - 2 9 11

43

Kurunegala 1 1 18 20North Western

Puttalam - 2 10 1232

Anuradhapura 1 - 18 19North Central

Polonnaruwa - - 6 625

Badulla 1 2 14 17UvaMonaragala - - 10 10

27

Ratnapura 1 1 13 15Sabaragamuva

Kegalle - 1 10 1126

Jaffna 1 3 12 16

Mannar - - 4 4

Vauniya - 1 4 5

Mullativu - - 4 4

Kilinochchi - - 3 3

Batticaloa 1 1 10 12

Ampara 1 1 14 16

North Eastern

Trincomalee - 1 10 11

71

Total 18 37 256 311 311

Source: Sri Lanka Institute of Local Governance

The central government decides on the structure of a local authority anddemarcates it after a public hearing where the electorate and other parties andorganisations are invited to participate. Local governments used to be divided intowards. Wards have been discontinued under the new proportional system.

To create, reconstitute or upgrade a local authority, the Minister in charge of

local government appoints a committee that is generally headed by an officer of therank of a Provincial Commissioner of Local Government or a divisional secretary.Members study the implications of establishing a local authority in a given area.

In the case of reconstitution or upgrading of a local authority, the committee

looks into the possibilities of carving out areas form other adjoining local authorities.

Reconstitution is entirely the preserve of the Minister of Local Government. However,it is generally based on policy. The committee also recommends the number of


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elected members the local authority should have. On receipt of the committeesreport, the Minster decides whether to reject or accept the recommendations of thecommittee. While normally committee recommendations have been accepted intotal, there have been cases where these were changed due to politicalconsiderations, particularly when geographical areas had to be carved our form

adjacent local authorities. However, even in such cases special attention is given tothe organisational and financial sustainability of the proposed local authority.

Local authority elections are held under the Local Authority ElectionsOrdinance. The district secretaries conduct elections in their capacity as ElectionOfficers in the districts. Their duties are limited to the preparation and certification ofelectoral registers and the conduct of the poll. The Commissioner of Electionsgazettes the list of candidates and gives all necessary directions to the ElectionOfficers on the conduct of the poll. The Commission of Election also decides thenumber of seats each party will get based on the election results. One importantfeature in local authority elections is the regulation that 40 percent of the candidates

on the nomination list should be between 18 and 35 years of age, which gives anopportunity for youth representation in local authority administration. There is nosuch regulation to provide a quota for womens participation.

Respective political parties or independent groups nominate the Chairperson or

Mayors, which does not appear to be a very democratic process. However, moredemocratic means of elections of heads of local authorities has created problems oflocal administration. One of the main issues arising has been the relationshipbetween the Chairperson/Mayors with the local authorities. There have been caseswhere councillors revolted against such relationship with the heads of localauthorities, causing embarrassment to political parties. On the other hand, someargue that over-dependence of local authority heads on councillors would createsituations that are more damaging to their general administration.

The composition of a local council is based on the total population of a local

authority area and not on a ward basis. This has certain advantages as well asdisadvantages. It permits councillors to pay attention to the local authority as awhole rather than to a ward that consists only of few settlements with a smallpopulation. When the ward-based election system was in vogue, the servicesrendered to infrastructure constructed were generally of a small size due to the factthat these needs were generally limited to a smaller geographical area. Instead of

such limitations, the councillors are now in a position to look at a broader spectrumand a larger geographical area, since they have to look up to and depend on a largepopulation for victory at elections.

Since the electoral system is proportional, it permits an elector to give his/her

preference to a political party or an independent group. Elected members have noallegiance to the micro level. Moreover, under the previous composition minorities,including small political parties, were finding it difficult to be elected due to limitationsin the number of electors in each ward. Under the present electoral system minoritiescan become a block vote and gain a place in the council. Such opportunity makesthe minority councillors concentrate on their block vote by developing the areas

occupied by such minorities, whether on political party, religion, race, caste oroccupational basis. Hence, minorities have gained from the new electoral system.


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Notwithstanding these facts, there are clear-cut disadvantages inherent in the

system. One is that the number of councillors is not so large to ensure service to alarge number in a geographically vast area, especially in case ofPradeshiya Sabhas(rural local authorities), creating under representation.

Lack of representation of poverty-stricken populations in the composition of

local authority membership has affected even the composition for committees,especially that of the municipal councils. The law provides of appointment of variouscommittees to assist the administration of local authorities. Since political input hasbeen uppermost in the minds of the politicians in power at municipal councils,adequate representation has not been the case in sectional committees, eventhough the opposition groups or members deserved representation. Therefore, thedifficulties faced by the poorer groups have increased. In case of thePradeshiyaSabhas the law provides for the appointment of committees. These could includeresidents of the areas. While appointed, the opportunities given to the political

opponents and the disadvantaged groups were minimal.

3.2 Local government structures and functions

The administrative structure is similar in all local authorities, although thedesignations are different. The municipal councils are headed by Mayors withdeputy Mayors and members of the councils making policy and policyimplementation decisions. The Mayor is Chief Executive and is assisted by themunicipal Commissioner, who is a senior public official. There are severaldepartments under the administration of a Municipal Commissioner, depending on

size, complexity, staff availability and resources of the municipality. For instance, theColombo municipality has several departments under the Commissioner, headed bya secretary, a chief engineer, an internal auditor, a veterinary surgeon, a chiefmedical officer and an assessor with sub units in each department. This structure isnot in place in many other local authorities, although there are some counterparts tothose officials in other municipal councils.

Section 40 of the Municipal Council Ordinance lists the general powers of

municipal councils. These are generally routine administrative powers, such asrecruitment of officials, acquisition of assets, licensing, instituting legal actions,budgeting and supplementary budgeting. Since municipal councils have to be

careful about unauthorised constructions in their area of authority, one importantpower given to the municipal councils is the power to demolish unauthorisedbuildings. Municipal councils provide public infrastructure services and areauthorised to acquire lands for public purposes. The general duties of the municipalcouncils are more important for the well being of the public. At the same time theseduties also serve as performance indicators of municipal councils, assisting thepublic to consider election of members for a second time.

The duties as stated in Section 46 of the Municipal Council Ordinance are as

follows:

Maintaining and clearing of all public streets and open spaces vested in thecouncil or committed to its management;


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Enforcing the proper maintenance, cleaning and repairing of all privatestreets; Supervising and providing growth and development by planning andwidening of streets, reservation of open spaces and execution of publicimprovements;

Abating all nuisance; Establishing and maintaining public utilities for the welfare, comfort and

convenience of the public; and Promoting public health, welfare and the development of sanitation and

amenities.

Law gives extensive powers to local authorities to meet their responsibilities.This includes making it mandatory for the police to help local authorities in enforcingtheir regulations. A majority of municipal council functions, such as health andsanitation activities, solid waste disposal, greening of the areas under their controland development of parks, could all be categorised as environmental activities. Bylaw, provision has been made to appoint a committee of councillors for the purposeof preparing schemes regarding maintenance of residential premises, and for makingrecommendations on the payment of incentives to residents who maintain highstandards of hygiene. This is an opportunity to prove the capacity to createparticipation of the public in maintaining higher standards of environment. However,a disheartening feature is that often such schemes or incentives are not madeavailable to the public. Although laws have given vast amounts of power to create asustainable and habitable environment in urban areas, it is found that thedevelopment processes have not been that effectively executed.

Another important power in the hands of Municipal Councils is market

facilitation and regulation in their areas of authority. While municipal councils can intheory facilitate economic development using these powers, most municipal councilshave not been able to take advantage of these regulations or have failed to facilitateor regulate economic activities. For example, the powers given to medical and healthofficers to inspect important places of business, especially hotels and restaurants arenot exercised regularly, causing hardships to the consumers. The municipalmagistrate system that permits trying offenders under 30 different laws could beused to maintain order, discipline, health and the environment.

In addition, municipal councils are permitted to borrow funds from financial

markets for development activities, acquisition of land, plants, machinery and

equipment. The auditor general audits the activities of local authorities.The powers of urban councils are enumerated in a separate ordinance: the

Urban Council Ordinance. Their general powers and duties are not very differentfrom the municipal councils. The duties of urban councils, as given in section 35 ofthe ordinance, are almost similar to the corresponding section of the MunicipalCouncil Ordinance. The main functions of the urban councils, like those of themunicipal councils are environmental in nature. Besides, urban councils, likemunicipal councils, are authorised to maintain and regulate markets. The vestedassets of urban councils show some similarity to municipal councils, since parks,open spaces, gardens, canals, public markets and public buildings within the urban

council areas become the property of urban councils.


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Pradeshiya Sabhas enjoy powers similar to municipal and urban councils withregards to routine administration of their areas. InPradeshiya Sabhas the focus ison thoroughfares, public health and market places and, thus, the focus on servicesand environment has not changed. However, due to lack of finances these functionsand services have not been sufficiently undertaken in many Pradeshiya Sabhas.

When these ordinances were promulgated, the central government was to

supervise the functioning of local authorities. However, with the 13th Amendment tothe Constitution this power has been transferred to the provincial councils. Similarly,processes of inquiry and oversight of local authorities have been transferred toprovincial councils. These powers have been granted provincial councils to checkthe excesses of individual municipal and urban councils, where Mayors andChairperson considered themselves above the law as elected representatives of thepeople. However, certain recent judgements show that deliberate harassment hasbeen caused to some of the Chief Executive Officers, Chairperson and Mayors thatmight have been based on political conflicts, questioning the objectivity of the

provincial council members. Political parties have taken a keen interest in localauthority elections, injecting politics in the decision making of the developmentprocess. One negative impact of such behaviour is the neglect of developmentneeds of a local authority that is in hands of the people who do not have the samepolitical affiliation. This is particularly of concern in Pradeshiya Sabhas and hasdegraded the standards at the local level. Although such criticisms can be levelledagainst local authority administrations, on the whole the concept to think and actlocally at the local authority level has not been shelved.

3.3 Local government finances

The financial position of local authorities is not sound enough to plan services for

a larger geographical area as this involves large investments. This has becomemore apparent in urban local authorities where the urban poor, living in shanties andsquatter settlements, do not pay any rates. Therefore, in some local authorities, theywere not given the same service compared to the ratepayers. In an electoralsystem that requires coverage of a larger area, more money is needed to contestelections and hence poor elements could not be adequately represented. Forexample, in the Colombo area 42 percent of the total population live in under-servedor low-income settlements, but they are not represented accordingly.

There is at present excessive financial dependence on, and influence of, thecentre in terms of local government finances. Control over resources and the mannerof their disbursement indicates the distribution of power between the centre andprovinces. The system of annual assessment of provincial needs combined with thenarrow revenue base of the provinces except for the Western Province imposesserious budgetary and financial management constraints. Thus regular fundingdelays and shortfalls further exacerbates negative effects of dependence on thecentre.

An important aspect of financial dependence on the centre is also theconcomitant implicit financial powers imposing financial obligations on the provinces.

The centre has regularly taken decisions in respect of devolved subjects that havefinancial ramifications for the provinces and then fail to provide the necessary funds


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to meet the additional financial obligations. The most serious incidence of suchimposition of financial obligations is in the area of devolved health services.

Chart 3: Financing decentralization-government transfers

to the sub-national level

Grants

AllocationsProject Finance

As shown in Chart 3, funds for recurrent budgets to the local authorities are

channelled through the Provincial Councils. Most of the local authorities do not getthese, or any other development funds, in a similar timely manner. The ProvincialCouncil, under which the local authority functions, often has difficult obtaining thesefunds even when the funds belong to them. If the Provincial Council and the localauthority are under different political parties the problem of transfer is compounded.Before the formation of the Provincial Councils, the funds were directly transferred bythe Central government to the local authorities.

Divisional SecretariatLocalAuthorities

President Parliament

Finance Commission

District Secretariat

Ministry of HA, PC & LG

Sector Projects

Line Ministries

Provincial Projects

Annual Budget

------------------------

Ministry of F & P

Provincial CouncilsStatutory Agencies


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Sources of revenue

The main sources of revenue for the local authorities are:

Rates; Entertainment tax; Trade/Business taxes; Rents; Licenses;

Court fines; Fees; Warrant costs; and Other income (stamp duty comes

under this item); and Governmentgrants.

The source of income will vary from council to council. If the council is more

urbanised, the main source of revenue will be property rates varying from 15 to 25per cent. If less urbanised, the main source will of revenue will be rents on councillands and commercial stalls, at rates also ranging between 15 and 25 per cent. Thegovernment grant is the main source of income, which brings in about 50 per cent ofthe total revenue. It is used for the reimbursement of salaries. The collection of ratesbrings in the second largest local revenue for urban local authorities such asColombo and Kandy Municipalities. For rural local authorities, rents bring in thesecond highest revenue. These are from rentals from sites by conducting weeklyfairs and public markets and from commercial buildings owned by the localauthorities.

Under the Urban Development and Low Income Housing Project, funded by theAsian Development Bank, the Sri Lanka Institute of Local Governance conducted a

study in 2001 to identify the main sources of self-generated revenues of 17participating local authorities (see Table 6). The three main sources were propertyrates, rents and trade licences/trade taxes/business taxes. Therefore, an importantrevenue-generating method in municipal councils has been the regular revision ofrates. Generally, rates are revised every five years. Complaint have been madethat some local authorities do not revise the rates by the given time periods. Anotherobservation is that some central politicians try to influence the rate revision processfor their political gain, irrespective of the effects on local authorities finance. Localauthorities are also faced with problems in trying to collect rates, and recovery ofrates varies between 20 to 90 per cent. The officials attribute many reasons to this.Political pressure by the elected councillors is cited as one of the main reasons. Sri

Lanka Institute of Local Governance will be targeting this area for further studiesduring the course of this year in order to improve the situation.

Though the government has recognised the raising of funds through the issueof bonds, no Municipality in Sri Lanka has yet tried this. Similarly, publicprivatepartnership have been minimal. There has been a general lack of interest to getinvolved with the private sector by the officials, mainly due to the fear of being foundaccused of impropriety on some transactions. However, this is gradually being offsetwith programmes being conducted by Institute of Local Governance, highlighting thatso long as the process is transparent, public-private partnership should beencouraged to provide a better service to the public. Colombo Municipality is leading

the way by promoting this concept and most of the street cleaning and garbagecollection is at present being handled by the private sector.


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Expenditure allocations

According to the Municipal Councils Ordinance, Section 185, each MunicipalCouncil shall establish a fund for its general financial purposes. Any expenditure to

be incurred by the local authority has to be from this fund.Table 6: Total budgeted recurrent revenues of participating

urban local authorities (ULA) (2002)

Name of ULA

Totalrecurrent

revenue 2002budget

Total ratesrevenue 2002

budget(%)

Total rentsrevenue 2002

budget(%)

Total tradelicencerevenue

(%)

Kandy MC 460,666,000 69,560,000 15.09 4,920,400 10.68 9,479,000 2.

Kurunegala MC 105,605,500 8,600,000 8.143 18,976,900 17.97 1,631,700 1.

Galle MC 134,451,680 33,216,000 24.7 10,554,000 7.85 4,461,000 3.32

Negombo MC 122,134,900 22,550,000 18.46 8,576,500 7.02 14,119,050 11.58

Gompola UC 32,940,150 7,100,000 21.55 4,900,000 14.88

Kegalle UC 34,225,010 2,592,850 7.57 7,942,760 2321

Hatton Dickoya UC 31,387,085 2,152,300 6.77 14,846,455 47.3 3,179,000

Seethawakapura UC 76,458,292 2,800,000 3.66 5,786,100 7.57

Anuradhapura UC 80,101,600 9,476,700 11.83 9,450,700 11.8 5,206

Bandarawela UC 32,596,600 2,200,000 6.74 10,227,300 31.38 4

Puttalam UC 28,474,375 5,000,000 17.55 1,430,000 5.02

PS Hingurakgoda 17,364,430 665,519 3.83 2,737,129 15.76

PS Akuressa 17,145,000 550,000 3.2 2,720,000 15.86

PS Tissamaharama

17,131,500 555,000 3.23 2,833,000 16.54 9

PS Embilipitiya 21,142,800 163,100 7.81 4,648,000 21.98 1

PS Ambalantota 17,824,700 1,020,600 5.72 5,136,300 28.82

PS Hikkaduwa 32,257,100 3,980,000 12.33 2,926,400 9.07 1,229

Source: Urban Development Low Income Housing Programme Report-SLILG 2002

According to section 190 of the Ordinance, at each general meeting of a

Municipal Council the Mayor shall submit to the Council a statement of receipts anddisbursements on account of the Municipal Fund from the close of the previous yearup to the close of the month preceding that in which the meeting takes place. Sucha statement, together with the minutes of the proceedings of the meeting, shall beforwarded forthwith to the Commissioner of Local Government, and shall bepublished in the Gazette.


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The actual expenditure account of a local authority is illustrated in Table 7below:

Table 7: Actual expenditure of Kurunegala M.C local authority (2000)

No Type of expenditure Estimatedexpenditure

(%) Actualexpenditure

(%)

Recurrent expenditure

1 Salaries & allowances 4,893,950.00 54.36 4780643.13 67.81

2 Travelling expenses 92,000.00 1.02 76128.21 1.08

3 Supplies & equipments 439,000.00 4.88 314322.75 4.46

4 Capital assets, repairs & maintenance 505,000.00 5.61 200766.10 2.85

5 Transport and services needed 285,500.00 3.17 198838.10 2.82

6 New development projects - 0.00

7 Acquisitions - 0.00

8 Interest payments, dividend, grants - 0.00

9 Grants, contribution & subsidies 77,450.00 0.86 92140.31 1.31

10 Pensions & gratuities 110,000.00 1.22 81073.14 1.15

Sub Total 6,402,900.00 71.12 5783674.61 82.04

Capital Expenditure

11 Capital expenditure 2,600,000.00 28.88 1308312.38 18.56

12 Loans repayments 0.00 0.00

Sub Total 2,600,000.00 28.88 1308312.38 18.56

Total 9,002,900.00 100.00 7050224.43 100.00

According to the Municipal Councils Ordinance, the Mayor of each MunicipalCouncil shall, after consultation with the several standing committees, on a date tobe fixed by him/her in each year, submit to the Council a budget containing anestimate of the available Municipal income and details of the proposed expenditurefor the ensuing financial year.

Every budget of the Municipal Council shall be circulated among theCouncillors at least seven days prior to the date referred to in section 211; and beopen to inspection at the Municipal office or at such other place as the Mayor maydetermine, for seven days prior to the said date and notice thereof shall be given bythe Mayor in the Gazette and in two or more of the newspapers circulating with in theMunicipality. Every Municipal Council shall finally consider the budget at a specialmeeting to be called in the last month of the financial year.

The Mayor may at any time prepare a supplementary budget and lay it before

the Council. Every supplementary budget shall be circulated among the Councillorsat least seven days prior to the meeting of the Council before which it is laid; and be

open to public inspection at the Municipal office or at such other place as the Mayormay determine for seven days prior to the said meeting an notice thereof shall be


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given by the Mayor in the Gazette and in two or more of the newspapers circulatingwithin the Municipality.

It shall be in the discretion of the Municipal Council to pass, modify, or reject all

or any of the items in any budget or supplementary budget or to add any item

thereto. According to section 215.A., if the Municipal Council modifies or rejects all orany of the items in any budget or supplementary budget, or adds any item thereto,and the Mayor does not agree with any such decision of the Council, s/he shall re-submit the budget or supplementary budget to the Council for future consideration.Where the Council does not pass a budget or supplementary budget within twoweeks after it is resubmitted, notwithstanding that it has not been passed by theCouncil, be deemed to be the duly adopted budget or supplementary budget of theCouncil.

The Mayor may, in case of necessity, during any year reduce or increase the

expenditure under any head of the budget or of any supplementary budget, or may

transfer the moneys assigned under one head of expenditure to another head. Thisis provided that the total amount of expenditure sanctioned by the budget or by anysupplementary budget passed by the Council is not exceeded. The authority forexpenditure conveyed by any budget or supplementary budget passed by aMunicipal Council, or deemed to be the duly adopted budget or supplementarybudget of such Council, shall expire at the end of the financial year to which such abudget relates.

It is observed that all urban local authorities are dependent on the government

grants disbursed by the Finance Commission through the provincial councils. If a 30per cent dependency ratio is considered a satisfactory phenomenon in revenuesharing, 5 out of 18 municipal councils can be considered to be generating sufficientfunds. However, only 3 out of 37 urban councils have achieved this level. Anothersource of funding that does not come under the purview of the provincial council isthe supply of funds through the decentralized district budget. Here the members ofParliament decide on the amounts of money to be invested in capital works in localauthorities. While deciding on priorities, they may be receptive to citizen groups, butnot necessarily to elected representatives of local authorities. This is particularly truein case an opposition party controls the local authority.

Allowing members of Parliament to allocate capital development funds through

the district budgets has had other negative impacts as well. Often, members ofParliament are keen on the construction of new facilities such as markets,playgrounds, roads etc. However, the district budget does not provide formaintenance of such facilities. Local authorities are thus saddled with maintenanceof facilities they did not ask for and for which they do not have finances. District anddivisional secretaries who are supposed to be neutral civil servants have oftensuccumbed to the demands of the members of Parliament and, in many cases, havebuilt facilities knowing that the concerned local authority did not have adequatecapacity to maintain these. Central development grants cannot be passed directly tolocal authorities and must be disbursed through the provincial councils. However,central government loses control over the use of the funds once they are passed to

the provincial councils. Considerations other than development often takeprecedence in decision making at provincial council level, resulting in the fact that


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development programmes of some local authorities that deserve funding remainunfounded.

Since taxation or fee levying is a politically sensitive issue, some of the

attempts to increase revenue have become quite unpopular. Even the normal

increase of rates that is done once every five years is not a popular move. Therehave been instances of postponement of such action, perhaps due to pendingelections. An issue that has been a bone of contention is the limitation in revenueearnings by local authorities, especially in urban areas, due to the take-over ofcertain services such as water supply, drainage and electricity supply that could beundertaken easily by local authorities. When inquiries are made on this issue,government-owned organizations argue that the liabilities of local authorities havebeen far greater than their capacities would permit to perform.

At the same time in urbanized areas such as Colombo, the local authority is not

in a position to perform its legitimate role to serve the total population. This is best

observed in case of low-income settlements. Since land ownership or land rights areestablished in case of slum/shanty dwellers, they have not been considered asformal residents of the municipal council areas. Hence services rendered to themare restricted or different. That has reduced the revenue generation capacity of themunicipal council. This cannot be corrected as long as discrimination takes place inservicing the low-income settlements in municipal council areas.

3.4 Personnel systems in local government

In the past, the civil service was divided into two cadres: the public service and

the local government service for which civil servants were separately recruited andtrained. The Public Service Commission and the Local Government Commissionoversaw both services. Although officially both services were considered equal, thepublic service was seen as superior to the local government service, particularly withregards to clerical, supervisory staff and technical grades. With the amalgamation ofthe local government service this situation changed. The administrative serviceofficials in the local government services were absorbed into the Sri LankaAdministrative Service. After implementation of the 13th Amendment to theConstitution, local government was automatically subjected to the provincial publicservice. As such they were subjected to the Provincial Public Service Commissionauthority and became transferable between local authorities. Hence, rules and

regulations applicable to the Provincial Public Service Commission are applicable tolocal authorities employees as well.

Resulting from the fact that all recurrent establishment costs are borne from

allocations made by the Finance Commission under block grants, provincial councils,and through them local authorities, are forced to decide on cadres, job descriptionand recruitment procedures as directed by the centre. Job descriptions of cadresdetermined in the early nineteen seventies were revised only in the mid nineties,since the provincial council and local authorities had to wait until the governmentagreed to a revision while services, population and investment s have increasedduring a period of about 25 years.


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The process of cadre determination is tedious; needs are studied andproposals are submitted to the Ministry of Local Government. The Ministry submitsthe proposal for staff revision to the Cabinet of Minister. The normal procedure is todirect the salaries and cadre committees of the central government to study theproposal and submit the proposal back to the Cabinet with a recommendation. A

government that is being pressurised by the World Bank and the IMF will not, as arule, increase public service cadres. Being aware of this situation, the committeeusually has a habit of reducing the numbers in the proposal. Generally speaking, theCabinet accepts the committees recommendation. Upon approval of the Cabinet,recruitment procedures are applied. Depending on requirements and grades, thedecision is taken who should do the recruitment. Generally, civil servants for all-island services are recruited by the central government, whereas the ProvincialPublic Service Commission takes responsibility in recruiting civil servants for otherservices.Training facilities

The centre undertakes the induction training for all island services while others

are mostly trained on the job. All Provincial Councils are equipped with aManagement Development Training Unit (MDTU) headed by the Deputy secretary ofthe Provincial Council. These MDTUs conduct the training programmes for theProvinces and they co-ordinate with the Sri Lanka Institute of Local Governance,which is the National Training Institution set up for the development of the ProvincialCouncils and Local Authorities.

An Act of Parliament has filled the absence of an Apex Organization for

Training and Research in the field of Local Governance, with the establishment ofthe Sri Lanka Institute of Local Governance (SLILG) in October 1999. It aims atfacilitating the institutional and management capability building of provincial councilsand local authorities for the efficient and effective provision of services to the people.SLILG through teaching, research and outreach addresses the vital area of GoodGovernance.

The Act has specifically been set up to:

(a) Provide training to the members and officers and servants of

Provincial Councils and local authorities with a view to equipping

them to perform their official duties efficiently and effectively;(b) Conduct workshops and training courses on provincial and localgovernment management;

(c) Award certificates to those who have successfully completed thetraining courses conducted by the Institute;

(d) Assist in the building up of a cadre of competent provincial and localgovernment officers and personnel in the country, with a view to ensuring goodgovernance;

(e) Make available to Provincial Councils and local authorities, the services ofspecialists in provincial and local government management;

(f) Assist Provincial Councils and local authorities in improving their organisational

systems and management capability;


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The power and functions of LAs are specified in relevant Ordinances and Acts.Comparatively, MCs have more power than UCs and PSs. It is important to notethat, under the 13th Amendment to the constitution, Provincial Councils can enlarge,but not curtail, the powers entrusted to Local Authorities.

It would seem that in effect Local Authorities find themselves stranded in ascheme of devolution where they must relate to the province on matters ofadministration and the centre in respect of matters of national policy. Therefore, thedividing line between policy and administration are to be sorted out between thecentre and the province with little or no involvement of the Local Authorities.

The constitutional provisions under item Four of List One of the Ninth Schedule

give a clear indication of the autonomous nature of local authorities. The nationalgovernment agrees on a national local government policy and determines the form,structure and constitution of local authorities. The supervision of the management oflocal authorities is the responsibility of the provincial councils. This demarcation of

power and authority, although clear, is not totally adhered to between the centre andthe provincial councils, due to other legal provisions. For example, under theMunicipal Council Ordinance (Section 11), Urban Council Ordinance (Section 10)and the Pradeshiya Sabhas Act(Section 5), the central Minister is authorized tocurtail or extend the term of office of the members of these local authorities by oneyear. The Minister of Local Government has exercised this authority on severaloccasions in the past and his authority has not been challenged so far.

Under the Constitution, the President appoints the Governor and the chief

secretary of the Province. In addition most of the key officials such as secretaries ofprovincial Ministries and provincial Commissioners are seconded from the centre tothe provincial public service. Thus, not only local authorities but also provincialcouncils heavily depend on resources provided by the centre.

The total establishment cost, including the remuneration of local elected

officials, is borne by Finance Commission Grants disbursed through provincialcouncils. The Central Salaries and Cadre Committee is responsible for the re-enrolment of local government staff and their salaries. However, this authority of theSalaries and Cadre Committee to determine the vacancies of local authorities hascreated enormous problems. From the governments point of view this kind of actionis necessary to restrict uncontrolled recruitment. Moreover, central government is

under constant pressure to reduce public and local government service cadres.Therefore, the Salaries and Cadres Committee has restricted its work to determinethe salary of local authorities in keeping with national policies.

The Commissioner of Election conducts local government elections and

maintains the appointment of membership in local authorities. However, throughouthistory the national political parties have been influencing the process by makingnational political issues the mainstay of canvassing votes for local authority election.Moreover, in addition to their own electorate and the provincial councils, localauthorities are answerable to Parliament through the auditor general and the PublicAccounts Committee. This is particularly so for funds made available to local

authorities by the Parliament through the provincial councils.


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The power to take action against the local authority management is provided inlocal government laws. For example, the power to remove the Chairperson or Mayorafter due inquiry of is referred to in Section 277 of the Municipal Ordinance, Section184 of the Urban Council Ordinance and Section 185 of the Pradeshiya Sabhas Act.The grounds for action under these sections are incompetence, mismanagement,

default of performance, refusal or neglect to comply with provisions of law and onlyfew business transactions.

The process of dissolution of a local authority has to be done through a legally

accepted procedure. Basically the Minister (in the provincial council) should besatisfied that sufficient proof is available to take action against the local authority onthe above counts. S/he has to appoint a retired judicial officer to report to him/herwithin three months on the allegations made against the local council. This enquiryhas the power of a Commission of Enquiry appointed under the Commission ofInquiry Act. Depending on the circumstances, the Minister has the power to suspendthe Mayor or the Chairperson and direct the deputy to carry on with the business of

the council. If the deputy Mayor or Vice Chairperson also has been suspended, theMunicipal Commissioner or Provincial Commissioner of local government of the areain which the municipal council, the urban council or the Pradeshiya Sabhas islocated will be appointed to perform the functions of the Chief Executive. The powerto suspend the respective councils and Sabhas is also provided for in law. When aMayor is removed, the Minister has to appoint a Special Commissioner to managethe affairs of the Municipal council.

The powers given to the Minster of Local Government in provincial councils on

local authorities have to be exercised in a lawful manner. The provincialCommissioner of local Government becomes the key official in advising the Ministerto effect his/her powers. While before the process of devolution of power there wasonly one Commissioner of Local Government, there are eight of them now with alarge number of officials, who inquire the affairs of the local authorities and makerecommendation for action. However, although local authorities are supposed to bedemocratic administrative units they are not fully autonomous, Provincial Councilscan pass powers, functions and responsibilities on authorities. More powers couldbe granted to local authorities if necessary; the provincial councils of North WesternProvince and Central Province have already given additional powers to localauthorities engaged in development activities in their respective areas.

However, as mentioned earlier, the Provincial Councils cannot curtail thepowers of the local authorities. Another impediment to increase the revenue baseand strengthen the power base of the local authorities is that they have to formulateby-laws. The local authorities suffer from the lack of expertise to formulate by-lawsas in the case of Provincial Councils failure to enact Statutes. This has retarded theprogress of these institutions to a great extent. At present, Sri Lanka Institute ofLocal Governance is in the process of organising several programmes to overcomethis limitation.


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4. EXTENT OF PUBLIC PARTICIPATION

One of the main objectives of establishing local authorities is to give the publicmore opportunities to participate in the decision making process regarding the

management and development of their respective council areas. For instance, thepreamble to the Pradehihiya Sabhas Actstates that: legislation is enacted with aview to providing greater opportunities for the people to participate effectively in thedecision making process relating to administrative and development activities at alocal level. Although there is provision in the local authority laws to appointcommittees and facilitate peoples participation, this provision has not been usedmeaningfully in the past.

There has been a general lack of interest by government officials to get

involved with the private sector, mainly due to the fear of being found faulty intransactions. However, this is gradually being offset with programmes beingconducted by the Institute of Local Governance, highlighting that so long as theprocess is transparent, public-private partnership should be encouraged to provide abetter service to the public. Local Authorities are faced with increased demands forimproved services, infrastructure challenges, fiscal constraints and scarce resources.A few municipalities are responding to this challenge by exploring and implementingalternative methods of service delivery.

The Committee system operating in Local Authorities is a very important

element of Management. The Committees are called Standing Committees inMunicipal Councils whilst in Urban Councils and Pradeshya Sabhas they are called

Committees. The Legal status of these Committees has been set out the MunicipalCouncils Ordinance, the Urban Councils Ordinance and Pradesya Sabha Act. Animportant change in the Pradeshya Sabha is that the committees in the PradesyaSabhas can include the general public whereas the Municipalities will have onlyelected members in the standing committees.Participatory budgeting

In promoting a need-based development, a bottom up strategy has recently

been promoted by the Colombo Municipal Council (CMC). The outcome of this wasthe introduction of Participatory Budgetary System.In previous years, officials

prepared budgets based on the estimates made by the departmental heads onneeds identified by themselves. However, the needs are now being identified inpartnership with the Community Based Organizations (CBOs).

A working committee has been formed, known as the core group, consisting

of CMC officials and NGO representatives. At present, only two NGOs arerepresented, which have been selected based on their past experience in workingwith the community. The core group has been allocated a budget of Rs. 25 millionfor the year 2003.

The format for budget proposals has been designed to encourage the

submission of project proposals by Community Based Organizations. Proposals areentertained only from Social Service organizations that have been registered with the


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Social Services Department under the Ministry of Social Services and also registeredwith the Colombo Municipality. Maximum funding per project is Rs. one million.However, Rs. 1.7 million was approved for the first proposal.

Subject areas were identified as follows:

Health and nutrition; Environmental management; Public utility; Economic development; and Child, youth, women and social development.

Only an abstract is requested at the initial stage and if the committee is

interested, a detailed proposal is solicited. Though the proposals are submitted byCBOs, the committee cannot be certain that the applicants have gone through theparticipatory process at the grassroots level in developing the proposals. However,the committee can obtain a fair idea by checking with slum societies, credit societies,grama niladaris, and with the Council Member of the area from where the proposal isgenerating. In addition to this, since the Municipality is divided into six districts andhas six community leaders, depending on the area from where the proposal isgenerating, the community leader of that respective district is co-opted to thecommittee to evaluate the proposal. This process encourages the social serviceorganizations to ensure the participation of the community.

In addition to obtaining their inputs for budget preparation, the CBOs are alsoused for community contracting. CBOs are being trained by CMC to perform this task

more professionally. Each programme lasts 10 days.Womens participation

Sri Lanka, that produced the first female Prime Minister in the world, hasachieved positive results in connection with womens public participation. This hasbeen a gradual process initiated since independence in 1948. However, since theRio Summit, specific goals have been accomplished in the areas of creation ofwomen entrepreneurs, and capacity building in decision-making, especially throughestablishing a Ministry for Womens Affairs, Womens Bureau, rural credit andsavings schemes, womens organizations and community leadership in the areas of

reproductive health, gender sensitization and training.The Womens Bureau implements a number of programmes and projects to

improve the economic status of women by providing skills and assisting in self-employment schemes. The creation ofWomen Entrepreneurs Programme has beenpromoted as the means to economic empowerment, decision making and also toform womens organizations. This has been implemented as a part of the IntegratedRural Development programmes of all Districts. NGOs such as Sarvodaya haveplayed a leading role in this programme.

There is an annual award scheme for women entrepreneurs to encourage

women participation in business. Rural Credit and Saving Schemes throughprogramme commercial banks are helping women who are in need of credit and


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financial security. The Bank of Ceylon in collaboration with the Womens Bureau haslaunched a credit scheme called Isuru Naya, enabling women to borrow Rs. 5,000 10,000 for self employment. The Janashakthi Bank, the Grameeya Bank, theSanasaand Sarvodayahave made a significant impact on women in rural areas.There are a number of programmes and projects implemented under the National

Plan of Action for Women 1995, which include counselling services on violenceagainst women, integration of womens needs and contribution to the developmentprocess, amendment to the Lanka Development Ordinance to ensure equal landrights to women.

A summary of the proportion of male and female councillors in Sri Lanka, based

on elections in 2002, is summarised in Table 8 below. A separate provision forparticipation in local government is not available for women or for those who aredisabled. However, there is strong lobby to include a higher percentage of women ascandidates in the future elections.

Table 8: Proportion of male & female councillors in LAA in Sri Lanka(Based on election 2002*)

Province Total Male (%) Female (%)

Southern Province 557 554 99.46 3 0.54

Central Province 603 594 98.5 9 1.49

Uva Province 320 314 98.12 6 1.87

Western Province 869 844 97.12 25 2.88

North Eastern Province 347 327 94.23 20 5.76

Sabaragamuva Province 422 416 98.57 6 1.42North Central Province 285 280 98.24 5 1.75

North Western Province 499 496 99.4 3 0.6

Total 3902 3825 98.3 77 1.97

Source Sri Lanka Institute of Local Governance.

*The total number ofelected members will not tally with the seat allocation per Province due to thefact that some of the local authorities have been dissolved. This difference occurs only in theSouthern Province and the North/East Province.

Youth participation

There is a legal provision, which requires the contesting parties to include 40per cent youth representation aged between 18 and 35 when forwarding candidatesfor the elections. This includes young women and men.NGO participation

Most NGOs in Sri Lanka are yet to understand the concept and the inter-

linkages between different subject areas and issues within sustainable development.Probably for the first time, various sectors lead by NGOs are showing interest inunderstanding the concepts of sustainable development and are attempting tocontribute in numerous ways as a result of the awareness brought about by the


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information to hold a World Conference on Sustainable Development. The Ministryof Social Services, The Divisional Secretariat, the Central Environmental Authorityetc have registered thousands of NGOs but most of these are inactive. There is alsoa NGO Secretariat. According to them there are over 10,000 NGOs.

5. CONCLUSIONS

Local authorities in Sri Lanka are faced with increased demands for improved

services, while facing infrastructure challenges, fiscal constraints and scarceresources. A few municipalities are responding to this challenge by exploring andimplementing alternative methods of service delivery. Some issues to bear in mindfor future strengthening of local governance are listed below:

Partnership building: There is a global trend towards partnerships as oneway to improve the delivery of municipal services. This approach uses theexpertise, investment and management capacity of the public and privatesectors to develop infrastructure, as well as to improve and extend efficientservices to all residents. The Colombo Municipality is handling solid wastemanagement by this private partnership approach. Many are reluctant toinvolve the private sector due to fear of getting a bad name. However, thiscould be overcome by introducing transparent systems.

Present proportional voting system: The proportional system of voting

has replaced the previous system of electing Ward members. At present, it iselecting for the whole area. If a person is elected on this basis, s/he is not

responsible for a particular area. This implies that if the general public takesan issue to a member, s/he can get away by saying that s/he was notselected by their vote alone and that they committed to serve all the areas(several wards). By saying this they get away from their responsibilities.

Legal and administrative constraints: All by-laws have to be prepared in

Sri Lankas three official languages (English, Sinhala and Tamil).Unfortunately, most of the local authorities do not have the capacity andfacilities to translate into these three languages or to draft modules at locallevel. To add to these difficulties, both these approaches are timeconsuming.

Excessive financial dependence on the centre: The narrow revenue base

of the local authorities imposes serious budgetary and financial managementconstraints and the local authorities will have to increase their revenue base.In order to do this, they have to improve their collection system andstrengthen their legal base to have the powers to take necessary action forthe overall benefit of the Council.

Capacity building: Most of the local authorities lack competent personnel to

manage the affairs of the Councils. Most of the competent officials prefer towork at the provincial and cenral government levels. However, if good career

opportunities are given with the proper training and motivation, it will bepossible to attract and retain qualified personnel. Several funding agencies


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have come forward to strengthen the capacity of the local authorities in SriLanka. At present Sri Lanka Institute of Local Governance is working closelywith UN-HABITAT and Asian Development Bank to implement theSustainable Cities Programme and the Urban Development Low-IncomeHousing Programme. Similar co-operation is anticipated with several other

donor agencies to strengthen the capacity of the local authorities.

References

Annual Review Report, 2000/2001, Financial Management Training ProgrammeConducted for the Staff of Urban Local Authorities under Urban Development andLow Income Housing Project, Sri Lanka Institute of Local Governance.Central Bank of Sri Lanka, 2001, Economic And Social Statistics of Sri Lanka.

Central Bank of Sri Lanka, 2003, Sri Lanka Socio-Economic Data 2003.External Resources Department, 2000, A Framework for Poverty Reduction.Gunawardena, A.S., 2001, Legal and Administrative Constraints ConfrontingProvincial Councils. Issues in Devolution and Governance in Sri Lanka, Sri LankaInstitute of Local Governance.Municipal Council Ordinance and Amendment Act 1987.Ministry of Interior, 2002, Sri Lanka Statistical Data Sheet, Year 2002, Department ofCensus And Statistics.Provincial Councils Act No.42, 1987.Town And Country Planning (Amendment) Act No.49 of 2000.Urban Councils Ordinance and Amendments Act 1987.

Documents

Country Report on Local Government Systems- Sri Lanka