Five donor agencies have committed $100 million to Nepal for implementing the proposed ‘Provincial and Local Governance Support Programme’ designed to strengthen the capacity of the sub-national governments to deliver public services.

The programme will replace the Local Governance Community Development Programme (LGCDP), a national programme introduced in July 2008 to contribute towards poverty reduction through inclusive, responsive and accountable local governance and participatory community-led development in the absence of elected local bodies.

With the country having the elected governments at both the provincial and local levels now, the government has planned to start the Provincial and Local Governance Support Programme (PLGSP) from January next year.

According to the Ministry of Federal Affairs and General Administration, the UK Department for International Development (DFID), the Swiss Agency for Development and Cooperation (SDC), Norway, the European Union and the UN agencies have agreed to provide $100 million for the new programme. The government will contribute $30 million on top of that, according to the ministry.

Of the total fund, $76 million will go to the local level and provincial governments will receive $41 million while the federal government will spend $13 million, according to the ministry. Officials said the fund could grow with the provincial and local governments contributing to it through their annual budget.

“These development partners committed $100 million after we concluded successful negotiations with them,” said Rasham Kadel, national programme manager at the LGCDP who has been coordinating the transition to the PLGSP.

“The 11th National Executive Committee meeting of the LGCDP represented by both the government and donors on Thursday decided to request the federal government to approve the PLGSP.”

According to the Federal Affairs Ministry, the main goal of the new programme is to attain functional, sustainable, inclusive and accountable provincial and local governments through strengthening of governance systems, procedures and inter-governmental relationship as well as enhancing the capacity of sub-national governments to deliver services and development outcomes.

Under the programme, federal institutions will develop legislations and policies to support the provincial and local governments in a consultative manner and the federal government will also develop the tools and system to provide support to the sub-national governments.

The provincial and local administrations will be modernised, enabling them to manage core public service works. The elected representatives and civil servants at the provincial and local levels will be trained for delivering high quality services under the scheme.

According to officials, the training would be provided in the areas of financial management, good governance, information technology, accounting, handling of judicial duties, preparing gender-sensitive budgets, revenue management and ways to raise internal revenues.

For the training, the Local Development Training Academy will be established in the seven provinces to train officials from provincial and local governments.

The programme also envisions the ‘Innovative Partnership Fund’ to reward the provincial and local governments for their innovative efforts to deliver better services to the people and to ensure good governance. “However, the total fund to be set aside for Innovative Partnership Fund has yet to be determined,” said Kadel.

Sources of Funding

Nepal government $30m

European Union $40m

DFID    $28m

Norway $20m

SDC    $10m

UN agencies $2m

Total $130m