RED-IFO: an Analytical Model

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Contributor: FAO
Contact: Jean Bonnal

RED-IFO: an Analytical Model

I. Introduction

It has been shown elsewhere that the advances in democracy in most African and Latin American countries, and the spread of macroeconomic stabilization and structural adjustment policies have made the disengagement of the state topical, which has given a new momentum to decentralization policies, and has created opportunities for other actors in rural development.

These developments should increase the efficiency of development policies, to the extent that they reflect the needs of citizens, and are formulated on the basis of local evaluation done by those who have the most relevant information.

It must be recognized that policies of centralized rural development have some risks. Taking these risks into account helps to identify a methodology for decentralization, and to design a set of support policies necessary to successfully carry out the decentralization process.

The RED-IFO model on decentralization identifies, on the one hand, the risks associated with decentralization, and on the other, a methodology and support policies for managing the risks and making decentralization a tool for rural development. The model helps in the design of a more adequate decentralization policy and in the evaluation of on-going processes.

II. The Risks of Decentralization

The disengagement of the state, and decentralization, entail certain risks resulting from the centralizing policies which were formerly in effect. The RED-IFO model starts with a concise analysis of the legacy of centralization, which helps it to identify five major risks of decentralization.

Risk 1. The Replacement of Supply-Driven Intervention with Demand-Driven Intervention
Centralizing policies were completely supply-driven, consisting of a general development strategy designed at the top by central government authorities, and not taking into account the demands of local populations. These policies did not adapt their instruments to the specific problems of each region or each social group. The risk of this legacy is that in the face of the inefficiency of supply-driven interventions, governments would resort to purely demand-driven policies. This approach would certainly have the merit of taking into consideration the specific circumstances of each locality or type of producer, but at the risk of dispersing interventions, and the loss of an overall view in the determination of rural development strategies. There is no empirical evidence showing that taking local solutions into consideration produces the best overall results for rural development.

Risk 2. Asymmetry in Information does not enhance the Coordination of Activities
In centralized administrations, information is centralized. The concentration of information at the central level of government takes away from local populations the possibility of knowing the institutional, economic and technological context in which they live, and participating effectively in policy determination. At decentralization this becomes a problem : even though local actors in development have a voice, they are unable to seectheir demands and problems from a general, national, perspective, or coordinate their activities. Development strategies targeting the local level even though based on precise knowledge of local problems, may not be coherent from a regional perspective, and even less so from a national perspective, of development. The possibility of formal participation made possible through decentralization is not enough. It is necessary to create the conditions for this participation. Therefore, symmetry in the access to information is a condition for the coordination of activities.

Risk 3. Paternalistic Legacy could lead to Diminishing Support Services
rom the point of view of centralized policy makers, only state interventions could correct the failures of the market, and open the way for development. This paternalistic approach maintained that rural populations could not effectively use the institutions of the market because they had neither the capacity to do so nor the resources to find solutions to their own problems. It hindered independent action by rural populations and governments. This legacy has enormous consequences because if the transfer of functions to local actors is not followed by a transfer of sufficient powers and resources, decentralization will lead to diminishing support services for small and medium size agricultural units, reinforcing the polarization between different types of producers, and the gap between commercial farmers and peasant farmers.

Risk 4. The tradition of Clientelism could lead to the Capture of Decentralization
Typical resource allocation in centralized policy, nourished clients of the state. These were those who were the most capable of clearly communicating their needs in terms of projects and programs, and had a level of organization enabling them to put pressure on the state to obtain the lion's share of public expenditure set aside for rural development. Clientelism gave rise to attempts at capturing institutional income and de facto solidarity between central governments and large producers, who being the sole interlocutors of the state, were the only beneficiaries of its interventions. The asymmetry in levels of organization in rural populations could translate into the capture of functions and resources transferred under decentralization, by local elite, municipalities, and the most organized and richest organizations.

Risk 5. Institutional Rigidity and the Pace of Decentralization
The local and intermediate levels of centralized institutions were designed to implement policy decided somewhere else. They are inflexible and find it difficult to adapt themselves to a changing environment. Their inflexibility and that of civil society organizations do not allow them to adapt themselves in the required time frame to the challenges of decentralization policy. It is not enough to adopt decentralization : it has to take effect immediately and must be implemented in a coherent fashion. Therefore, the question of the suitable pace of decentralization must be raised.

III. The RED-IFO Model for Decentralization

In order to overcome the problems posed by the legacy of centralization, the RED-IFO model proposes, first of all, a methodology of decentralization which consists of the regionalization of the needs of rural populations, and the differentiation of policies (Risk 1); then three support policies dealing with information (Risk 2); training (Risk 3); organization (Risk 4); and finally full consultations on the modalities of the most appropriate schedule for the implementation of decentralization (Risk 5).

Regionalization and Differentiation Methodology (RED)

To overcome the first problem of decentralization (Risk 1), decentralization policy makers must create a forum for interaction between, on the one hand, the actors in development who have an overall view, and general policies to offer, and on the other, actors who have a knowledge of local circumstances and specific project or program support proposals. This forum would be the place for the formulation of a strategy for decentralized rural development. In other words, so that proposed policy is not too broad, it must be varied, given on the one hand, the special problems of each region, produce, and type of producer, and on the other, the support most adapted to the various development actors. At the same time, to avoid the request by local actors being too narrow, and for interventions not being too dispersed, the preferences of rural populations have to be regionalized to broaden their scope, and give them an appropriate level of coordination and coherence.

The combination of regionalization and differentiation would facilitate the transition from centralized policies to policies more reflective of local reality, but having a level of coordination and coherence that makes them a lever for development. And so the state can redirect its action toward suitable policies, that would make it possible for the agricultural and rural sector to be the foundation for a development strategy, creating employment, and diversification between agricultural and non-agricultural revenue, while helping the poorest segments of the population to increase their chances of fitting into the various markets.

Differentiation of policies and regionalization of preferences can be crucial so that actors in development can agree through consultations on an effective and transparent rural development strategy. The aim of these consultations would be to coordinate the actions of the actors; for each actor to recognize the strengths that other actors can bring to bear on decentralization. Support policies for decentralization would be designed and implemented within this general framework.

Support Policies: Information, Training and Organization (IFO)

For the expected impacts of decentralization to materialize, three support policies for regionalization and differentiation are necessary, according to the RED-IFO model to facilitate access to information, training and organizational support.

The Role of Access to Information

It has been pointed out above that asymmetry in the access to information doesn't facilitate the coordination and coherence of activities. Policy for access to information has a two-fold objective: on the one hand, the production of information necessary for the formulation of a rural development strategy, and on the other, the creation of conditions for the flow of this information to all actors in rural development. Access to information for all is a condition for dialogue between the state and the other actors in development, without which there cannot be a participatory and decentralized development strategy. For this dialogue to be established, it is necessary for interlocutors to have the same quantity and quality of information on the problems and opportunities (institutional, macroeconomic, technological) that affect local development.

Production of information and its flow can let rural populations have some control over development action, and guarantee the coherence of interventions to the extent that local actors would have information beyond that pertaining to the circumstances of their lives. This is a priority for decentralization to have an economic, technological and participatory content.

Training to avoid Institutional Voids

The long period of centralized government hindered rural populations from acting independently. The technical capacity of all actors in development must be ensured or strengthened so that decentralization does not give rise to diminishing support services, and that decentralized functions could be carried out. It is necessary therefore that the transfer of functions be followed by a transfer of powers to technical services, local governments and civil society organizations.

The necessity for training also comes from the fact that decentralization emphasizes the demands of local populations. But then municipalities and civil society organizations have varying degrees of capacity to formulate their demands. All depends on the accumulated social capital and organizational experience of any particular entity. Without a significant training policy, decentralization would favor the richest and best organized local governments and organizations, at the detriment of those that have the most need for support but do not have the capacity to formulate their demands in terms of development projects and programs. Therefore, priority in training has to be directed to these levels of government and civil society organizations.

Though the availability of information and training can halt the trend toward the capture of decentralization by local elite, that may not be sufficient if there is no strong organizational base to give actors in development the possibility to participate in the design, the implementation and monitoring of policies. That's why the third support policy recommended by the RED-IFO model is support for civil society organizations, recognizing them as interlocutors of the state, and the creation of an institutional framework favorable to participation. The importance of organizations has many dimensions:

  • Organizations can guarantee the participation of rural populations in the formulation of the modalities for decentralization, and that they are not formulated solely by the central government. The objectives, the modalities and pace of decentralization can thus be discussed with local actors.
  • Organizations facilitate institutional innovations that allow actors in development to actively participate in policy differentiation and in the regionalization of demands for support. It's through organizations that different social groups can become actors in their own development because they reinforce their ability to reclaim functions previously centralized.
  • Finally, organizations are important because the success of decentralization depends on the existence of local structures of mediation and consultation, which transform social pressure into development projects and programs. But the important role of social pressure must be recognized. Centralized states had the tendency to see conflicts as nothing but opposition to their interventions, whereas often, conflicts were demands for intervention. These demands took the form of conflicts because there wasn't any forum for dialogue at the local level. With decentralized mediation mechanisms, social pressure could be a vehicle for structuring demands and synthesizing them into a rural development strategy.

The pace of decentralization is one of the first areas where dialogue between the state and other actors in development should take place. In determining the rate at which decentralization will be implemented, it has to be recognized that the situation of each region, production conditions, and the strategies of each actor, are all reasons for implementing decentralization on the basis of dialogue between national and local actors, and on the regionalization of the results of such dialogues. This would facilitate the variation of the pace of decentralization, taking into account the specific capacity of each region, each town or municipality, and each social group, to take on and develop the functions assigned to them. Overall, the RED-IFO model proposes decentralization as a gradual process of the transfer of functions, resources and decision-making powers at the rate suggested by institutional capacity.

IV. Conclusion

The modalities for decentralization, and the support policies of the RED-IFO model are not compatible with a centralized state considering itself the only actor to deal with the beneficiaries of its policies. Differentiation and regionalization, on the contrary, suppose that there be dialogue between the multiple actors. In order for that to happen, it is necessary that the institutions of the centralized state give way to new institutions capable of creating the conditions for dialogue between the state and other actors in rural development. But these new institutions must not be seen as instruments bringing information, training and organization to rural populations. They must be to a large extent the creation of rural populations themselves, who would thus be providing the means to engage in dialogue with all their partners. That is why the strategic direction of the RED-IFO model is the creation, reorganization and building of institutions.

Decentralization centered on institution building would allow the state to be present across the nation and get closer to local realities, without losing the national perspective in its rural development actions. If the goal of the RED-IFO model is to enlighten actors in rural development on the risks and conditions for the success of a decentralization process, its keystone is the creation of institutional conditions that would enable the participation of citizens in the choice and implementation of actions affecting their future.

The model implicitly recognizes that the prospects of decentralization can only be realized if it is closely tied in with the building of democracy. The transition from supply-driven intervention to demand-driven intervention can be made in this manner: a) under the impetus of local actors in development, b) without decentralization producing voids, and c) in formulating a coherent, participatory, and overall strategy that works for all actors in development, not only for the strongest and best organized. Hence the model proposes the creation of a new alliance for sustainable and participatory rural development, toward which rural populations participate fully, and for the expansion of rural markets, savings, and investment, three key factors in any rural development process.