Decentralisation and Regionalisation in Portugal

✍ Scribed by OECD

• Publisher: OECD
• Year: 2020
• Tongue: English
• Leaves: 130
• Category: Library

✦ Synopsis

This report has been prepared by the OECD upon request by the Portuguese Independent Commission for Decentralisation. Decentralisation and regionalisation reforms have recently emerged on the Portugal’s policy agenda, with two main objectives: assigning more tasks to municipalities and strengthening regional level governance. The report presents a diagnosis of Portugal multi-level governance in international perspectives and highlights the strengths and challenges of the system. It then presents three potential policy paths of regional reform for Portugal. As the options are not mutually exclusive, they could work as complements to each other. The report analyses the conditions under which the reforms may deliver more economic efficiency and regional equity.

✦ Table of Contents

Foreword
Acknowledgements
Introduction
References
Executive summary and main policy options for Portugal
Overview
Main challenges faced by Portuguese multilevel governance
Limited ability to address regional level issues
Modest spending and revenue decentralisation limit the benefits received from decentralisation
The differences in fiscal capacity between municipalities
Tax competition between municipalities may improve efficiency but can also have negative side-effects
Volatile municipal tax bases may create spending risks
Unclear role of intermunicipal co-operation
Overlapping assignments between deconcentrated central government units may be a source of inefficiency
The slow economic growth in Lisbon and Porto areas
Ways forward in the process of decentralisation in Portugal
Prerequisites for a successful territorial and institutional restructuring
Three scenarios for enhanced decentralisation in Portugal
1 Why do countries decentralise?
What is decentralisation and why do countries decentralise?
Main types and forms of decentralisation
Fiscal federalism as a starting point for decentralisation
The benefits and challenges of decentralisation: A summary of the main effects
Economic outcomes
Administrative and political outcomes
Decentralisation goes hand in hand with an upscale of subnational governance
Experiences from intermunicipal co-operation
The rationale, benefits and challenges of co-operation
International examples and experiences of intermunicipal co-operation
Metropolitan governance in the OECD and beyond
The rationale for metropolitan governance
Examples of metropolitan governance models
Regionalisation: An increasing trend worldwide
Asymmetric decentralisation
References
Notes
2 Regionalisation in the context of decentralisation reforms
Strengthening regions in a multilevel governance framework
Regionalisation through deconcentration
Regionalisation through intermunicipal co-operation
Regional decentralisation
Political regionalisation (institutional regionalism)
Regionalisation reforms in the EU countries: An overview
Regionalisation and regional institutions
Regionalisation and identities
Opportunities and risks of regionalisation
Regional reforms in Finland, France and Poland
One- or two-tier subnational government? The Finnish experience
French experiences on regionalisation
Regionalisation and decentralisation in Poland
Summary of the country examples
References
3 The case of Portugal: Diagnosing multilevel governance strengths and challenges
Stage of decentralisation in Portugal
Subnational government structure
Political decentralisation
Administrative decentralisation
Subnational government responsibilities
Autonomous regions
Local governments
Intermunicipal co-operation and metropolitan governance
Municipal enterprises
Deconcentrated central government regional bodies
Administrative regions: A description of yet-to-be-established regional governments
Subnational government financing
Decentralisation in Portugal in international comparison
Main challenges faced by Portuguese multilevel governance
The current Portuguese multilevel governance model does not directly address regional level problems
The rapid demographic change and sluggish recovery from the economic and financial crisis form together a tricky policy environment in Portugal
Modest spending and revenue decentralisation miss the potential benefits of decentralisation
The differences in fiscal capacity between municipalities put pressure on the transfer system and fiscal equalisation
Tax competition between municipalities may have both beneficial and damaging effects
Volatile municipal tax bases may create spending risks
Room for more impact evaluation of public policies concerning subnational governments
Unclear role of intermunicipal co-operation
Municipal population size is high in European comparison
Overlapping assignments between deconcentrated central government units may cause unnecessary duplication and be a source for inefficiency
Portuguese model of multilevel governance in comparison with systems in other EU countries: The path-dependency revisited
Countries with one subnational government tier
Countries with two levels of subnational government
Countries with three levels of subnational government
Portuguese multilevel governance model
The Portuguese model in comparison with Finland, France and Poland
Regional development policy in Portugal
Regional performance and disparities in Portugal
Demographic change poses long-term challenges, particularly in non-metro areas and in the north of Portugal
Lisbon and Norte play an important role in Portugal’s economy but regional inequalities are relatively low compared to other OECD countries
Regional policy as a test case for broader multilevel governance reforms: Key achievements and outstanding challenge
Introduction
Overview of Portugal 2020
A strategic focus on competitiveness and internationalisation, as well as sustainability and resource efficiency
Increased prominence of regional programmes and territorial approaches
Growing focus on less developed regions, particularly the Norte and Centro
Governance and institutional framework for regional policy
National
Regional
Subregional and local
Regional policy as a test case for broader multilevel governance reforms: Key achievements and outstanding challenges
Key achievements
Key outstanding challenges
References
Notes
4 Ways forward in the process of decentralisation in Portugal
Making reform happen: Prerequisites for a successful territorial and institutional restructuring
Three scenarios for enhanced decentralisation in Portugal
Decentralisation and strengthened deconcentration without empowerment of regional level
Aligning the regional networks of deconcentrated central government departments with CCDRs
Strengthening the capacity and fiscal autonomy of municipalities for enhanced service delivery
Clarifying the role of intermunicipal co-operation
Intensifying metropolitan governance in the Lisbon and Porto areas
Rethinking the task assignments between levels of multilevel government
Decentralisation without full regionalisation by reinforced municipal and intermunicipal levels
Decentralisation through complementary regionalisation and intermunicipal co-operation reforms
References
Note