Participatory Budgeting at the Local Level (AM0050)

Brief Description of the Commitment
Ensuring the participation of residents in the governance of the community is one of the necessary prerequisites for effective local selfgovernment. Residents of the communities are the direct beneficiaries of the public decisions adopted at the local level, thus the task of local self-government bodies has to be being as close as possible to the residents of the given community, providing opportunities for the residents of the community to participate in local self-governance and involving them in the process of decision-making by local self-government bodies. Fulfilment of the mentioned obligation implies the creation of operational opportunities of "Participatory budgeting" envisaged on community websites for the residents, for the purpose of promoting the citizen participation in the community budgeting process. Participatory budgeting has a clear goal of developing social justice and democracy, which is achieved by encouraging active participation by citizens. Currently, residents have an opportunity to get familiarised with draft community budgets, performance and reports on the official electronic websites of municipalities, participate on-line in public hearings, submit proposals and opinions on the draft budget, as well as follow the implementation and management of the budget on-line. Through the mentioned commitment, it is planned to develop and expand the participatory opportunities of community websites, provide citizens with the appropriate toolkit to present ideas to be financed by the community budget, participate in their selection, and monitor their implementation. Through the mentioned tool, the residents of the community will be able to: - submit ideas/projects to be financed and implemented by the community budget; - vote for a proposed idea/programme; - follow-up the implementation of selected programmes. For implementation of the ideas, it is envisaged to propose to local self-government bodies to earmark a budget for financing and implementing the programmes proposed by the citizens having received the maximum number of votes. The exact size of the budget will be determined by the decision of the Council of Elders. In parallel with the introduction of the relevant toolkit on the websites of municipalities, it is planned to develop a guide for the implementation of participatory budgeting. It is envisaged to include both citizens (including various groups) and civil society representatives in the process of development of the toolkit for the purpose of developing a citizen-centred, accessible and convenient tool. In addition, it is envisaged to carry out public awareness activities to increase citizens' awareness of the possibilities of participatory budgeting. The residents of communities will have an opportunity to improve their community together with the municipality; besides, this platform of proposals will provide an opportunity for municipalities to collect the problems posing a concern for the residents and find solutions.

Problem definition
1. What problem does the commitment aim to address? The confidence of citizens in the representatives they have elected in that the latter will address their concerns aimed at the improvement of community life underlies the democratic development. This is especially important at the community administration level where the effectiveness and quality of provision of services are felt directly, and rendering of transparent and accountable decisions enhances the probability of social and economic development. The analysis of the current situation shows that a low level of citizen participation exists in Armenia at the local level despite the fact that the pre-conditions necessary for participation are ensured from the legal perspective. As community budget relates to any resident of the community, decisions regarding the budget provide a great opportunity to engage residents in participatory democracy. Citizen participation in the process of local budgeting will help community authorities to be more informed and render more effective decisions, as well as will allow residents to see and understand that importance is attached to their voice and viewpoints, ideas and programs proposed by them are discussed, viewed and receive an opportunity to be implemented by the local self-government.

2. What are the causes of the problem? The Law of the Republic of Armenia "On local self-governance" prescribes guarantees and forms of community participation of citizens, and enshrines provisions relating to the discussion of the concerns the citizens have in the process of budgeting. The Law also prescribes liabilities on publicity and accountability of the budget. At the same time, many municipalities do not have relevant capacities, approaches and experience in engaging their citizens in the complex process of budgeting. Moreover, the practical experience in developing and enforcing participatory processes is also missing at all. That is why the commitment aims at providing local self-government bodies with a tool kit for introduction of an active and citizen-oriented participatory budgeting parallel to the full enforcement of the current legal framework, as well as public awareness-raising on the participatory opportunities and advantages.

Commitment Description
1. What has been done so far to solve the problem? The Government of the Republic of Armenia has prescribed guarantees and forms of community participation of citizens, and enshrined provisions relating to the discussion of the concerns the citizens have in the process of budgeting in the Law of the Republic of Armenia "On local self-governance". A number of e-participation tools have been introduced in the official community electronic websites, such as online discussion of draft budgets, online broadcast of sessions of the council of elders, holding public hearing, etc. The mentioned commitment will allow providing municipalities with an additional tool kit to improve the current processes and contribute to the full enforcement of the legal framework, by concurrently raising the citizen awareness.

2. What solution are you proposing? In order to promote citizen participation in decision-making at the local level, it is proposed to: - introduce a "participatory budgeting" electronic subsystem in the community management information system; - develop a guide on participatory budgeting introduction and provide it to municipalities; - introduce and apply the "participatory budgeting" subsystem in three communities of the Republic of Armenia; - conduct public awareness on participatory budgeting. The implementation of the mentioned measures will allow introducing and testing the "participatory budgeting" tool kit in the Republic of Armenia for the purpose of further dissemination and application in the remaining communities.

3. What results do we want to achieve by implementing this commitment? The introduction of participatory budgeting will allow promoting the direct participation of residents in community decision-making, community budget planning and management, increasing confidence in local self-government bodies and civil responsibility of residents. At the same time, communities will be ensured provided with relevant tool kit and knowledge to promote citizen participation.

Commitment Analysis
1. How will the commitment promote transparency? The introduction of participatory budgeting will allow shifting from "isolated" forms of local self-governance to more open, transparent and participatory approaches, and making the process of community budget formation more transparent.

2. How will the commitment help foster accountability? Participatory budgeting will create an opportunity for local self-government bodies (LSGBs) to be more accountable as it will lead to a more transparent administrative work style. LSGBs will become more responsive to people's needs and expectations. The society, by participating in the budget process, will be more informed about drawing up the budget, the components thereof, and various stages of the process. Besides, upon being informed, citizens may carry out contextual discussions with stakeholders.

3. How will the commitment improve citizen participation in defining, implementing, and monitoring solutions? The introduction of participatory budgeting will allow increasing citizen participation in decision-making at the local level; will create favorable conditions for residents to participate in community budget development and further implementation thus promoting the formation of participatory local self-governance and democracy. Citizens will have the opportunity to propose programs to local self-government bodies, participate in voting and selection of programs on community websites, as well as follow up and monitor the further implementation of the programs.

Commitment Planning (Milestones | Expected Outputs | Expected Completion Date)

Action 1. Development of a guide on participatory budgeting introduction | Development of a guide on participatory budgeting introduction and public awareness | December 2022

Action 2. Development of a participatory budgeting electronic subsystem | Development of "participatory budgeting electronic subsystem in the community management information system | December 2022

Action 3. Implementation of participatory budgeting in three communities | Presentation of the developed electronic component to stakeholder communities; pilot testing of the component in three communities — Abovyan community of Kotayk Marz, Ashtarak community of Aragatsotn Marz and Armavir community of Armavir Marz of the Republic of Armenia | October 2023

Action 4. Public awareness on participatory budgeting | Citizen awareness-raising and improvement of skills on participatory budgeting | June 2024

Relation of the Commitment to strategic documents and other international processes Public Administration Reform Strategy: public communication and formation of the institutional system of participation. 2021-2026 Program of the Government of the Republic of Armenia: to 6. Institutional Development — Section "6.8 Fiscal Policy", in which importance is particularly attached to increasing public resources management and targeting. Public Finance Management System Reform Strategy for 2019-2023 (Target 21). OECD’s suggestion: to improve access to information and public communication in the Republic of Armenia. Sustainable Development Goal 11 Sustainable cities and communities Make cities inclusive, safe, resilient and sustainable Sustainable Development Goal 16 Peace, justice and strong institutions: Promote building fair, peaceful and inclusive societies. Sustainable Development Goal 17 Partnerships for goals Revitalize the global partnership for sustainable development.

Action Plan Review

Commitment 5. Participatory budgeting at local level (“Citizen budget”)

● Verifiable: Yes

● Does it have an open government lens? Yes

● Potential for results: Modest

Lead agency: Ministry of Territorial Administration and Infrastructure

For a complete description of the commitment, see Commitment 5 in Armenia 2022–2024 action plan here.

Context and objectives:

The law on local self-government requires local councils to hold public discussions on their annual community budget before it is adopted. However, the local authorities often treat these discussions as a formality, engaging local civil servants and their relatives in order to mark them accomplished, or sometimes not organizing consultations at all. [28] The lack of participation is also due to the small budgets of communities and low probability of changes in planned allocations. [29] At the same time, there are cases of successful participation in communities where the budget is larger, particularly in communities with active CSOs and community leaders that are open to collaboration with civic groups. [30]

The current commitment will allocate a specific amount of the community budget for projects suggested by citizens and supported by votes of the local population. It will be piloted in three communities: Abovyan, Armavir, and Ashtarak. The commitment was proposed by the Ministry of Territorial Administration and Infrastructure. The CSOs that have experience in participatory budgeting within donor-supported programs and/or working with local governments find that participatory budgeting is a useful approach to encouraging participation in local decision-making. [31] As with previous OGP commitments on local governance, the German Agency for International Cooperation is supporting the implementation. [32] One of the communities in the pilot, Armavir, has also undertaken a commitment on participatory budget in its OGP Local action plan. [33] As a starting point, the commitment will develop guidelines and a toolkit on how to introduce participatory budgeting that can be used by any local self-government body in the country. According to the action plan, public awareness raising on the participatory opportunities and advantages will also be implemented for the commitment.

This commitment will advance civic participation by offering the possibility to increase public interest in budget development and expanding opportunities for citizens to provide input on community projects.

Potential for results:Modest

Public participation in local government in Armenia is low. This is one of the key challenges in the local self-government system, along with the weak role of the council of elders, lack of fiscal autonomy for local communities, and limited powers of local self-governments. [34] By piloting participatory budgeting, this commitment could support local administrations and community leaders to proactively engage citizens in the budgeting process. This could increase public interest in participating in local budgeting, especially if submitted proposals are incorporated directly into the budget, following citizen voting. Moreover, the incorporation of citizen proposals in their community’s budget could help address urgent social or economic needs of the local population.

This commitment could have modest potential for results. The guidelines and toolkit on how to engage in participatory budgeting are good resources, but their usage will be voluntary. Nonetheless, the guidelines and the toolkit (as well as the technical setups for community websites to allow citizen voting on proposals) will be available for all communities in the country. [35] Thus, other interested communities could use these resources to apply their own participatory budgeting approaches. The commitment does not specify the amount of money that the three local self-government bodies will allocate for participatory budgeting. However, the commitment in Armavir’s OGP Local action plan says that Armavir has allocated AMD 1 million (about USD 2,500) for participatory budgeting in its 2023 budget, which is equal to approximately 0.05 percent of the community budget.

Apart from greater interest and participation in local budgeting, the commitment could help local governments promote the use of community websites and available opportunities for public engagement among citizens. This could in turn encourage local governments to publish more information on their websites that is useful to citizens. Moreover, stakeholders engaged in implementation note that the technical tools for participatory budgeting could open opportunities for other participatory initiatives. These include voting for subvention projects submitted to the government, soliciting citizens’ feedback on budget items and other initiatives proposed by the municipality, and organizing discussions on community issues raised by the citizens or as suggested by the local administration. [36]

Opportunities, challenges, and recommendations during implementation

Participatory budgeting is more likely to succeed when the amount and flexibility of allocated money is relatively high, to provide sufficient incentives for meaningful participation and substantial impacts. [37] It is also important that local government officials ensure timely delivery of co-decided proposals. This could increase the confidence of citizens in their ability to influence public investment and set a good example for other communities who wish to implement similar initiatives. It will also be important to encourage a wide range of social groups to participate, to prevent participatory budgeting from becoming a new form of clientelism in these communities.

To improve the potential for results of this commitment, the IRM recommends the following:

• Raise public awareness of the possibilities to participate in local budgeting processes through targeted communication. The commitment includes public awareness raising, which is essential for successful implementation. It is important that awareness raising is not limited to publishing information on community websites, as this may not be sufficient for reaching residents. Targeted communication with community “influencers” (i.e., respected and well-known people in the community), in-person meetings with residents (e.g., townhall meetings) and local CSOs could strengthen public motivation to participate. Trainings and mentoring local administrations could also ensure there is adequate capacity for implementation in the communities. The organization People Powered has a toolkit for officials, government staff, and institutions on how to launch a successful participatory budgeting process. [38]
• Ensure the processes for participatory budgeting in local self-governments are fully transparent. It will be important for local communities to clearly communicate the process of selecting citizen initiatives and explain the amount allocated for citizen proposals. For example, during a participatory budgeting commitment in its 2018–2020 OGP Local action plan, São Paulo, Brazil, used the city government’s platform to register information on the proposals submitted, the number of votes received, and the proposals accepted. [39] It is also important to provide reasoned response to citizens’ proposals. A good example is the municipality of Batumi’s participatory budgeting commitment in Georgia’s 2018–2019 action plan. [40] The municipal government’s participatory budgeting website has a page where all submitted, approved, and rejected proposals are listed. [41] Under the rejected proposals, the municipal government provides an explanation of why it rejected the proposal, such as why it was not feasible or outside the jurisdiction of the municipality.
• Publish simplified budget documents and information to improve public engagement in budgetary processes. Simplified budgets (e.g., a “Citizen Budget”), diagrams depicting the process of decisions, and other user-friendly materials could increase interest in local budgeting and improve public oversight of budget implementation. Publication of community budgets in open data format (planned by Gyumri and Vanadzor in their joint OGP Local action plan [42]) could also improve access for citizens, local media, and CSOs to budget information. The local communities should consider the needs of specific groups, such as the elderly or the disabled, when providing budget information, collecting suggestions, and informing on implementation to guarantee equal participation.
• If possible,consideradopting mandatory regulations on participatory budgeting for all local governments. Such regulations could be addressed in the next amendments to the law on local self-government. This could help ensure that the commitment leads to a permanent change to government practice by continuing participatory budgeting beyond the two-year action plan cycle. For example, in its 2020–2022 action plan, Côte d'Ivoire committed to establishing a legal and regulatory framework for participatory budgeting in all localities in the country. [43]
• Encourage engagement of communities not involved in the pilot and support the use of the guidelines and toolkit to standardize participatory budgeting across communities. To ensure wider uptake of participatory budgeting beyond the three pilot communities, it will be important to clarify how other communities might benefit from the guidance and toolkit and broaden the results of the pilot activities. For example, the municipality of Jermuk, though not one of the pilots, has initiated participatory budgeting, with an allocated amount of AMD 5 million. Jermuk has experience in allowing citizens to provide proposals on the community budget through an online platform. The government can support Jermuk and other communities in incorporating the tools from this commitment into their participatory budgeting practices.