Local Public, Fiscal and Financial Governance by Brian Dollery & Harry Kitchen & Melville McMillan & Anwar Shah

Author:Brian Dollery & Harry Kitchen & Melville McMillan & Anwar Shah
Language: eng
Format: epub
ISBN: 9783030367251
Publisher: Springer International Publishing

Decentralized provision of infrastructure is advocated for better matching of infrastructure services with local preferences and needs and for enhancing efficiency and equity of public provision. But if decentralized provision is seen to lead to a higher incidence of corruption especially with higher order grant financing then these advantages may be undermined. Corrupt practices in infrastructure affect the whole project investment and operations cycle and result in projects with roads and bridges to nowhere and creation of white elephants while a median voter is denied access to basic services such as clean water and sanitation. Potential of such corrupt practices is enhanced when these projects are mostly financed by higher-order governments which is often a necessity with decentralized provision of infrastructure or external donors. Since infrastructure projects are typically lumpy and have long gestational periods, corrupt strategic behavior of current regimes can tie hands of future regimes to the priorities set by the initiating regime. The times of fiscal stress offer even greater opportunities for corruption as projects must be approved, financed and implemented on an accelerated schedule. In view of the potential negative impact of corruption on good governance, it is important to analyze the implications of decentralized provision of infrastructure for good government both in theory and in practice with a view to examining options for limiting opportunities for corruption while enhancing possibilities of detection and punishment. This chapter takes an important first step in this direction by providing a synthesis of conceptual and empirical literature on this subject and highlighting the limits of our knowledge in this area especially the void in the area of empirical underpinnings of lessons in combating corruption.

The chapter is organized as follows. Section 6.2 provides an introductory review of fundamental concepts and concerns relating to corruption, its many facets and its drivers. Section 6.3 highlights corruption concerns with decentralized infrastructure provision. Section 6.4 presents counter-arguments and discusses the promise of decentralized provision of infrastructure for improved service delivery and reduced corruption. Section 6.5 synthesizes available evidence on the relationship between decentralized infrastructure provision and corruption. Section 6.6 draws overall tentative conclusions on the susceptibility of decentralized provision to corruption. Section 6.7 draws lessons for a strategy to combat corruption when infrastructure provision is decentralized. A final section provides concluding remarks.

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