Provincial and Local Governance Support Program (PLGSP)


Nepal’s new federal constitution addresses the long-standing root causes of conflict related to poverty, gender inequality and social exclusion. The Provincial and Local Governance Support Program is the government’s nationwide framework capacity building initiative to enable the newly elected provincial and local governments to assume their constitutional rights and duties. Switzerland led the planning for the development partners, The program will strengthen subnational institutions and service delivery, and contribute to peace and stability.

Country/region Topic Period Budget
Nepal
Conflict & fragility
Governance
Conflict prevention
Public sector policy
Decentralisation
01.04.2019 - 15.07.2023
CHF 9'900'000
Background

Nepal’s federal constitution (2015) requires to restructure Nepal’s polity through devolution of power and inclusive institutions. The former unitary system has been converted into three tiers of governance, creating 753 local governments, 7 provincial governments and the federal government. Executive and legislative powers are shared between different tiers. Exclusive and concurrent rights are granted to all tiers of government for the execution of their duties and they are often overlapping. The new governments are expected to work together through a system of “cooperation, coordination and coexistence”.

The implementation of the new federal constitution has been substantial with the completion of elections at all three tiers of government. However, despite impressive progress, the lack of preparation at the subnational levels and the absence of an overarching transition management plan are hampering a smooth implementation of the constitution and are risking a deterioration in service delivery and the resurgence of new conflicts. The establishment of inclusive provincial and local governance institutions and systems is therefore critical. It will require new competencies, structures and resources. Critical dimensions in this regard include devolving the public administration; institutionalization of fiscal federalism including establishment of intergovernmental fiscal transfers; and local service delivery mechanisms. In the meantime, the federal government is also expected to adopt the spirit of federalism and to change itself to support the transition, as transformation from a unitary state to a federal system involves significant structural, behavioral and perception changes.

Supporting the federalization process by promoting the implementation of the constitution is key to address long-standing root causes of conflict in Nepal related to poverty and various forms of discrimination as happened in the past. Given the importance of a successful federal experience for the conclusion of Nepal’s peace process, and given the profound challenges outlined above, the government and like-minded development partners have decided to support the federalization process through a nationwide Provincial and Local Governance Support Program (PLGSP). PLGSP will be the only national framework program to empower subnational governments in line with the constitution. It will be a government-led program that is fully owned and managed by all governments across the three tiers of the new federal structure.

Objectives Provincial and local governments are fully functional, sustainable, inclusive and accountable to their citizens.
Target groups

All 753 local and 7 provincial governments, and their elected representatives and officials, are the major target groups as well as the main beneficiaries. PLGSP mainly intends to build their capacity and establish their institutions, systems and structures on a demand basis. Elected representatives at subnational levels, both executive and legislative, including from women and disadvantaged groups, will benefit from the program. In addition to the subnational levels, federal government ministries, agencies and institutions are also a primary target group.

 

Local government associations - both national and provincial chapters - and civil society organizations including the private sector are a secondary target group.

Medium-term outcomes
  • Government institutions at federal, provincial and local level as well as inter-governmental mechanisms are functioning in support of federal governance as per the Constitution.
  • Provincial and local governments have efficient, effective, inclusive and accountable institutions.
  • Elected representatives and civil servants at provincial and local governments serve citizens to their satisfaction.
Results

Expected results:  

There are a total of 14 outputs proposed which aim to capture achievements of and cooperation between federal, provincial and local governments. The main expected outputs from this phase are:

  • Federal level institutions develop legislations and policies to support provincial and local governments in a consultative manner
  • Inter-governmental administrative mechanisms strengthened
  • Provincial governments draft legislation in a consultative manner
  • Provincial government systems provide horizontal and vertical accountability to all citizens and mainstream Gender Equality and Social Inclusion  
  • Provincial Centers for Good Governance deliver capacity development services
  • Local government systems provide horizontal and vertical accountability to all citizens
  • Innovation Partnership Fund is operational and transparently supporting local governments’ innovative practices
  • Provincial governments’ elected representatives and civil servants are incentivized and trained for delivering high quality services
  • Local governments’ elected representatives and civil servants are empowered and trained for delivering high quality services


Results from previous phases:   PLGSP is a new program that is modeled after the experience of the successful Local Governance and Community Development Program (LGCDP) which formally ended in 2018. LGCDP managed to improve relations between state and citizens in the absence of locally elected representatives, mainly through social mobilization. The program also led to visible empowerment of disadvantaged groups, evidenced by the fact that around one third of the newly elected local representatives were beneficiaries of LGCDP. Importantly, the experience of LGCDP has shown that a government led and implemented program is critical to ensure national ownership and sustainable results. Accordingly, development partners supported an inclusive, Nepali-led multi-stakeholder planning process which took two years to complete. It also resulted in PLGSP becoming an official government program that is implemented on-budget and on-treasury through a basket fund.


Directorate/federal office responsible SDC
Credit area Development cooperation
Project partners Contract partner
International Financial Institution (IFI)
Foreign state institution
  • Central State of South East
  • World Bank - International Development Association


Other partners
PLGSP is the government of Nepal’s capacity building framework program supported by the EU, Norway, Switzerland, UK and the UN system. It is implemented by government through an on-budget and on-treasury basket fund. The main partner and executive agency of the program is the Ministry of Federal Affairs and General Administration.
Coordination with other projects and actors PLGSP is the government’s national framework program. All future federalism related capacity building initiatives at subnational levels will have to be aligned with and complementary to PLGSP. In the Swiss focus area of Province 1, PLGSP will coordinate with SDC’s forthcoming bilateral State Support Program through its Provincial Steering Committee. PLGSP will also take over the outputs and learnings from SDC’ Interim Capacity for Federalism Support Project, and coordinate its capacity building activities at the local level with the SDC supported She Leads women’s empowerment program. In other provinces where Australia, Germany, UK and US are setting up bilateral subnational governance programs, PLGSP will also ensure complementarity through its Provincial Steering Committees. PLGSP also complements the World Bank administered multi-donor trust fund on Public Financial Management supported by SECO in Nepal.
Budget Current phase Swiss budget CHF   9'900'000 Swiss disbursement to date CHF   30'000 Budget inclusive project partner CHF   130'000'000
Project phases Phase 99 16.07.2023 - 15.07.2030   (Planned) Phase 1 01.04.2019 - 15.07.2023   (Current phase)