In the 12th Plan, local governments might be given at least 50 percent of development budget to address economic, environmental, and climate change challenges in the communities.

A report on the current state of fiscal decentralisation was launched yesterday.

Regional director for Asia and the Pacific, Dechen Tsering, said that given the greater emphasis on the role and responsibility of local government and local actors, it is important to ensure adequate technical competence, institutional capacity, and financial system are put in place at the local level.

“Poverty eradication and reducing inequality; improving carbon neutral, climate and disaster resilient development; and decentralisation are among the proposed national key results areas for the 12th plan,” said Dechen Tsering.

The report also cover issues related to fiscal decentralisation such as resource allocation formula, linkage with the central government, revenue sharing mechanism, and the capacity to plan and implement an enhanced fiscal decentralisation.

Director general of Department of Local Governance, Lungten Dorji, said that the department is implementing pilot Performance-based Climate Change Adaptation Grant (PBCCAG) in six gewog in two dzongkhags – Wangdue and Zhemgang.

He added that the about 25 percent above the capital grant is being provisioned for these pilot projects. “The disbursement of support is performance based, and to institute such mechanism, understanding the financing mechanism is very crucial.”

The UN resident representative, Gerald Daly, said that the 12th Plan would help Bhutan advance the sustainable development goals and in achieving its core aim of ‘leaving no one behind’. “We are conscious of how the gewog development grants are disbursed. During field trips to the east, we were engaged in discussions about leaving no one behind and the benefits of an economy that should not leave out the vulnerable.”

The department will try to include the report’s nine recommendations for the improvement of the fiscal decentralisation in the country in the national decentralisation policy that is currently being developed.

Deputy chief programme officer with Department of Local Governance, Wangdi Gyeltshen, said that before drafting the policy, a concept note including the importance and activities to strengthen the policy would be submitted to Gross National Happiness Commission.

“The recommendations will fit in to the policy to consider on how the recommendations will be taken forward,” Wangdi Gyeltshen said. The recommendations will also be discussed with relevant agencies.

The report was launched by the Department of Local Governance with support from United Nations Development Programme–United Nation Environment Poverty-Environment Initiative (PEI).

Phurpa Lhamo