Commonwealth Local Government Forum

Local government finance

Resourcing local government remains a central challenge to effective decentralisation. This section has content relating to different models of fiscal decentralisation, options for identifying new sources of local revenue, such as local property tax; and strategies for improving collection and deployment of own-source revenue. It also offers information about improving the borrowing potential of local government, innovative financing models such as municipal bonds, shared services, and public private partnerships.

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Improving subnational government development finance in emerging and developing economies: toward a strategic approach

Considerable attention has been given to enhancing subnational development finance in response to the 2008 global financial crisis and recent global development agendas, including the Sustainable Development Goals, Financing for Development, and Habitat III/New Urban Agenda. Much work on this topic is fragmented, focusing on specific elements of development finance: fiscal transfers, capital market access, public-sector lending agencies, or public-private partnerships. Most countries, however, have a range of subnational governments with varying needs and capacities that require different and evolving mixes of development finance mechanisms. Enabling greater subnational borrowing is often desirable but requires adoption of other reform policies to improve the fiscal capacity and creditworthiness of subnational governments over time. This paper reviews the rationale and potential for improving subnational development finance, outlines the overall landscape of institutional arrangements available for this purpose, and considers broad challenges involved. Based on a review of global practice and experience in selected Asian developing countries with a range of special entities and innovations to enhance subnational investment, it proposes a more integrated, strategic approach to building subnational development finance.

Author: Paul Smoke Publisher: Asian Development Bank Publication year: 2019


Reducing Urban Greenhouse Gas Emissions: Effective Steering Strategies for City Governments

In the IMFG Perspectives Paper (No. 16), Reducing Urban Greenhouse Gas Emissions: Effective Steering Strategies for City Governments, Sara Hughes reviews the unique strategies of three cities leading the charge: Toronto, New York City, and Los Angeles. The paper identifies three strategies that have proven effective: Building and maintaining a broad-based coalition of governmental and non-governmental actors working toward a common goal; Investing in capacity-building, data collection, and education; and Embedding new ideas, financial tools, and standards into local formal and informal decision-making institutions. “Cities are critical climate change actors, and will be for the foreseeable future,” says Hughes. “Given the jurisdictional and financial constraints local governments face, their climate change goals will demand creative partnerships, new tools and systems, and innovative institutional cultures.” This paper is part of a series of IMFG publications and events focusing on cities and climate change.

Author: Sara Hughes Publisher: Institute of Municipal Finance and Governance, University of Torronto Publication year: 2017


Resource guide on decentralisation and local government

This resource guide provides practical guidance for designing, implementing and evaluating decentralisation reforms and local government practices to ensure they are as effective as possible. It also synthesises and presents current debates on the impact of decentralisation and local government on poverty reduction, service delivery and conflict as well as providing links to cutting-edge research and recent case studies.

Author: Zoe Scott and Munawwar Alam Publisher: Commonwealth Secretariat Publication year: 2011


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