Nepali citizens remain largely dissatisfied with the government’s lacklustre public service delivery in both the political and bureaucratic domains. Governance failings include political ineptitude, poor policy design and implementation, rent-seeking bureaucracy, ineffective regulatory mechanisms, weak institutions, a culture of impunity and accountability gaps. Despite various government efforts such as the introduction of automation and digitalisation in certain sectors, these shortcomings have persisted. The problem appears to be the inability of these interventions to penetrate the structural and mindset resistance of the bureaucracy and politics. In surmounting these challenges sustainably, interventions at the local level, with higher levels of younger leadership, citizen accountability and experimentation appetite, is a colossal opportunity for results-based governance reforms.

Globally, most of the power and resources rest in the hands of a few. Centralisation has been a long-ignored criticism of Nepal’s government structure until the new constitution was promulgated in 2015. Similarly, a remarkable tendency prevails among central authority figures to resist power devolution because they fear the loss of their hard-earned perceived and real influence in decision-making. Despite such resistance, decentralisation has enhanced public service delivery in Nepal. This was most apparent during the height of the Covid-19 pandemic where despite their nascency, the local governments effectively bore the administrative burden of surveillance, testing, quarantine, isolation, record keeping and security.

Innovation potential

With the advent of the three-tier federal governance system, local governments are more likely to experiment and deliver change as they exercise their mandate away from the scrutiny of the centre. Although May 2022 local elections are only the second round of elections since the constitutionalising of federalism in 2015, the expectation of the citizens has increased manifold from their local representatives, thus rendering productive pressure to perform and break away from ailing implementation methods and unpopular development targets. This second cycle may prove to be the right time to experiment with new social and technological tools and institutionalise innovation as the mainstay of a public service delivery mechanism.

Since municipalities are at the heart of the public service delivery and local development process, ensuring that the available and latent local resources, including human potential, are utilised most productively is important. In that vein, strengthening local economic governance by building clarity, commitment and capacity among the key ecosystem stakeholders, within and outside of the municipal government, is critical. The Governance Lab and Daayitwa launched the Leadership for Economic Governance project in 2021 intending to accelerate the economic growth of the country by bolstering the policy leadership capacity of municipal governments to identify and address local economic growth challenges. During the pilot year targeted at Musikot, Tilottama and Sunwal municipalities of Lumbini province, the project engaged three mayor-led municipal teams, composed of politicians, bureaucrats, entrepreneurs and civil society leaders to learn about different facets of the economy, governance and leadership, and apply the learning in achieving local economic growth targets.

The teams participated in a multi-module executive policy leadership course and implemented 100-day youth employment projects in their municipalities. These projects utilised the Rapid Results Initiative approach which refers to “a structured set of results-oriented, low risk, change-driving, team-based and problem-solving management tools. They are used to mobilise teams to achieve tangible and dramatic results, accelerate organisational learning from a series of small-scale, results-producing and momentum building projects within typically 100 days or less”.

The results that the three municipal Rapid Results Initiative teams achieved in 100 days are promising: In Sunwal, 39 aspiring women entrepreneurs received an orientation about women entrepreneurship and tailoring enterprise training. All the trained women successfully registered their businesses with the municipality. In Tilottama, 60 aspiring entrepreneurs received handicraft-making training and were later able to start their businesses. In Musikot, 100 aspiring entrepreneurs received livestock and agriculture-related training. They were all able to successfully register their businesses.

Local capabilities

Innovation doesn’t just happen on its own, and it is even harder within government structures. A ripe environment shaped by authority figures, who encourage diversity in ideas, collaboration in executing and risk-taking in behaviour, and reciprocated actions by teams, who followed a disciplined process despite distractions, is critical. In the Leadership for Economic Governance programme, the mayors authorised the Rapid Results Initiative teams to promote youth employment in 100 days in priority areas of the municipality. The teams created their smart targets and action plans. During the implementation, a feedback loop between the mayor and the teams enabled the mayor to guide the team and hold it accountable and the teams to stay motivated.

Local governments derive their informal authority from being able to connect to the grassroots, and surveys have shown they have a higher level of trust when compared to provincial or federal governments. A closer relationship between the governors and the governed creates a smaller feedback loop making it easier to hold authorities accountable. During the Leadership for Economic Governance project, local actions to promote youth employment through locally rooted and empowered institutions, such as volunteer groups, various local government departments and non-governmental organisations, local cooperatives and banks, resulted in an improvement in the registration of local businesses.

The 100-days consisted of four reviews for the teams to present their progress and learning as well as gain feedback from and build trust with the mayor and senior public officials. As a result, not only were the Rapid Results Initiative teams able to achieve the targeted results and build functional capacity, but also gained further authorisation and legitimacy for the Rapid Results Initiative and other projects.

The Nepal government, particularly espoused by the Ministry of Federal and Government Affairs, continues to prioritise innovation-led local economic development. However, much needs to be done to ensure that local institutions, including municipalities, have clear legal and policy mandates, adequate financial and human resources, an accountability framework that holds political actors and public servants accountable, and an informed and engaged civil society. Leadership and governance reforms are key in this mission and can be possible through a focused approach of problem-driven, solution-oriented, iterative methods such as the Leadership for Economic Governance programme piloted in three municipalities of Lumbini province by the Governance Lab and Daayitwa. What is required now is its scaling, replication and adaptation in numerous other communities across the nation.