Participatory Budgeting in Porto Alegre

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ORÇAMENTO PARTICIPATIVO - OP PARTICIPATORY
BUDGETING Claudio Acioly Jr. IHS c.acioly_at_ihs.nl
BRAZIL Porto Alegre, Santo Andre, Belo
Horizonte, Vitoria, Brasilia, Itabuna and more
than 140 Brazilian cities in 2001
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Participatory Budgeting democratising the
allocation of public funds
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A participatory channel open for new leaderships
and new relationships State-Citizenship
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Participatory Budgeting broadening the civil
society participation on public policy making
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1. Municipal Autonomy in Brazil
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Local Governments in Brazil

• Complete political autonomy
• Mayors and municipal councils chosen in local
  election
• Unrestricted, constitutionally-mandated shares
  of principal taxes levied by Federal and State
  Governments
• Power to impose variety of local taxes, with
  unrestricted rates (5 major taxes)
• Control of their own civil service
• Power to set salaries and administrative
  structure

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3.Governance in Brazil
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New Constitution (1988)

• Legal provisions for urban policy and property
  rights
• Social function of the city
• Social function of land property
• Civil society mobilization Urban Reform
  participatory urban management
• Recognition of informal settlements
• Usocapião (Adverse Possession 250 m² - 5 years)
• Urban Development Plan with popular
  participation
• Recovery of citizenship rights of urban
  dwellers
• The right to the city!

Democratization and further empowerment of
municipalities.
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Civil society participation Social function of
Cities Social function of land property Participat
ive democracy
1988 Constitution
Citizen constitution Pro-municipality
Reform in Health Sector
Reform in Education Sector
Agrarian Land Reform
Urban Reform
Blocked by Conservative Political Forces

• SUS Unified Health System-decentralised
• National Health Fund
• Municipalisation of Primary Education
• Child Youth Statute
• Sector Councils (civil society control of the
  state on social policies)

Estatuto da Cidade - 2001 Regulation via ordinary
laws Instruments Land regularisation Taxation
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Federal Legislation providing general guidelines
to local governments

• Law 6766/1979
• Land sub-division
• Municipalities given mandate to enact rules and
  directives for land use
• Technical requirements for approval of land
  subdivision
• Minimum 35 of developers site to be allocated
  to public space collective facilities
• Minimum plot 126 m²
• Heavy punishments to developers carrying out
  illegal sub-divisions
• Developers accountable
• Municipalities creating ZEIS, AEIS
• Promotion of regularisation

Law 6015-1973 Regulating the process of
registration of Land transactions

• Law 9785-1999
• Provisions to de-regulate the process of land
  subdivision
• Making easier forms of legalization thus better
  conditions for security of tenure

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1. Understanding Public Budgeting
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BACKGROUND HISTORICAL FACTS ON PUBLIC BUDGETING

• Year 1215 in ENGLAND limit the discretionary
  power of the king to impose tax
• End 1800s not only a law on taxes but
  transformed into a governmental plan of action
• Today an instrument to program the work of the
  government as a whole and each one of its
  agencies in particular , as a means to control
  public finances.

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PUBLIC BUDGET
Instrument to work of the government
Means to control public finance
Details objectives targets realizations of an
administration
Government Planning
Main instrument to allow a certain control of
public sector activities
How much it costs a particular service for
society
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2. Public Budgeting in Brazil
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• DISPUTES POLITICAL
• PRESENCE TO DIRECT THE EXECUTIVE
• DECISIONS IN PUBLIC MONEY ALLOCATION

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BRAZIL
Municipal governments have relative autonomy as
central collector and distributor of the
resources produced by society
MUNICIPAL RECEIPTS
MUNICIPAL EXPENDITURES
Transfers from the levels of the state (state ,
federal )
Own Revenues
Investments in public works equipment,
machinery
Personnel
Public services including contracting services
to third parties
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3. What is Participatory Budgeting? Orcamento
Participativo OP
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One definition Process of prioritisation and
conjoint decision making through which local
civil society representatives and local
governments actually decide on the final
allocation of public investment in their cities
on an yearly basis.
It is a cyclical, intricate but transparent
process of organisation, public meetings and
debates in support to the preparation of the
annual municipal budget. Acioly et al (2002).
Participatory Budgeting in the Municipality of
Santo André, Brazil, IHS / SIMPA, unpublished
report.
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4. How does the OP works? PORTO ALEGRE
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Orçamento Participativo
Geographic Basis
City is divided in 16 Regions
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STRUCTURE OF THE PARTICIPATORY BUDGETING
MEDIATION BETWEEN THE MUNICIPAL GOVERNMENT CITY
RESIDENTS
2- COMMUNITY INSTANCES , AUTONNOMOUS IN RELATION
TO THE MUNICIPAL ADMINISTRATION
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1 -ADMINISTRATIVE UNITS INTERNAL AGENCIES OF
THE MUNICIPAL GOVERNMENT (EXECUTIVE)
3- PERMANENT INSTITUTIONAL INSTANCES FOR
COMMUNITY PARTICIPATION
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STRUCTURE OF THE PARTICIPATORY BUDGETING IN PORTO
ALEGRE
THREE INSTANCES OF MEDIATION BETWEEN THE
MUNICIPAL GOVERNMENT( EXECUTIVE) CITY RESIDENTS
3- PERMANENT INSTITUTIONAL INSTANCES FOR
COMMUNITY PARTICIPATION ROLE To allow joint
management of public resources and provision of
accountant statements of the executive to the
communities in the allocation of budget resources
1 -ADMINISTRATIVE UNITS INTERNAL AGENCIES OF
THE MUNICIPAL GOVERNMENT (EXECUTIVE) ROLE
Management processing of the political and
technical discussion of the budget with residents
2- COMMUNITY INSTANCES , AUTONNOMOUS IN RELATION
TO THE MUNICIPAL ADMINISTRATION ROLE To
articulate the participation of the inhabitants
and the priority setting of the region of the
city
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Organs Municipal Administration
Community Organs
Institutional Organs Participation
Regional Assemblies
MAYOR
Popular Councils Community Coalitions Regional
Municipal Secretariats
GAPLAN Planning Unit
CRC Coord Relation Communt.
OP COUNCIL
16 FORUM Delegates
FORUM Planning Assist.
Community Organizations
OP Regional Coordinators
Profession Entities
Thematic Plenary Sessions
Thematic Coordinators
Inhabitants of the Region
Civil Society Org. Social Movements
5 FORUM Thematic Delegates
FORUM Thematic Coordinators
LEGISLATIVE CHAMBER
Source PMPA/Fedozzi, 1997
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March preparatory meetings, assessment of local
demands
October / December OP Council discusses votes
IP-Investment Plan, approval of budget in
Municipal Council
March / April 1st Round of Assemblies, election
of delegates, review previous year.
August / September OP council discusses budget
proposal submitted to mayor
The OP Cycle
March / June Intermediary meetings, population
prioritises
June / July 2nd Round of Assemblies, population
presents demands, election of OP Councillors
July / August New OP Council takes office,
Criteria to distribute resources, Executive
matches resources with demands
May / August Begins elaboration of budget
proposal, synchronisation institutional
community demands
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5. Participatory Budgeting Theoretical
Political Fundaments
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Democratisation of Public Management

• Citizen Participation and deliberation on the
  public investment (prioritisation, public works
  and government actions).
• Transparency and adoption of popular control to
  prevent corruption and misuse of public money.
• Rupture of bureaucratic barriers separating State
  Society by recognising and accepting autonomous
  character of civil society vis-a-vis the
  government

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Exercising Direct Democracy

• Any citizen can participate in the OP as it
  provides opportunity for combined participation
  direct participation (plenary sessions) and
  representative forms (Forum of Delegates and the
  OP Council).
• Popular participation takes place not only in the
  formulation of the budget but also in the
  elaboration of the Plan of Investment and
  Services (public works) and in the inspection of
  the implementation thereafter.

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Exercising Direct Democracy

• Preserving the role of the Legislative Power
  (Elected Municipal Chamber of Representatives)
  that has the legal competence to approve the
  budget, since popular participation takes place
  during the formulation of the budget proposal
  during the phase under strict competence of the
  Executive Power (mayor his government.
• Combination of the principle of legality (popular
  participation in the elaboration of the municipal
  budget is prescribed in LOM-Law on Municipal
  Budget) with the principle of popular autonomy
  (self-regulation through the internal rules of
  the OP).

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Consolidating Citizenship Consciousness

• Increasing the level of social and political
  consciousness of the citizen through
  participation, access to information and actual
  control over the state.
• Stressing the values and norms of participation,
  of responsibility and solidarity above
  paternalism and clientelism, absence and
  individuality

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6. Participatory Budgeting Operational Aspects
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OP - THE PROCESS I
STAGE 1 Regional Assemblies (16
regions) Assemblies (independent from
region) Spatial boundaries of the regions
tradition of organized movements of population
versus exclusive technical division / zoning
Thematic Assemblies (5) 1. Transport
circulation 2. Education ,Leisure culture
3. Health social assistance 4. Economic
development taxation 5. Organization of the
city urban development

• 16 regional assemblies per year , twice a year
• 5 thematic assemblies per year , twice a year
• Open to any individual participant and
  representatives of civil society
• Representative of the executive attend these
  assemblies (Mayor municipal secretaries)
• Coordinated by members of municipal
  administrations and community representatives
  from the OP Council

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Official registration of participants attending
the Regional Plenary Meetings
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OP - THE PROCESS II

• BEFORE ANNUAL ASSEMBLIES
• Series of preparatory meetings of the residents
  during the month of MARCH
• No involvement /coordination from municipality
• Follows its own dynamics
• Surveys demands of individuals/residents , CBOs
  organized groups active in the region or thematic
  area (Culture, Health, Economic Dev.)
• Mobilization to elect local representatives to
  take part in decision making sphere of OP.
• Assessment of the previous year and community
  mobilization for the first annual assembly of OP.

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Plenary Session at the East Region of the City
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OP -THE PROCESS III

• MARCH/ JUNE
• PREPARATORY MEETING INTERMEDIARY
• Population
• Region theme
• Approval of demand
• Prioritization
• Discussion of priorities from NGOs,CBOs Unions,
  Civil Society organizations
• Negotiations
• THREE Priorities per sector
• List is sent to executive
• Final election of delegates based on 110 in the
  most attended meeting

• JUNE - JULY
• SECOND ROUND OF REGIONAL THEMATIC ASSEMBLIES
• Executive presents tax/fiscal policy,Strategy,reve
  nue generation expenditure policy
• Criteria to distribute resources
• Community representatives present the priorities
• Election of representatives to the OP COUNCIL
  2 members plus 2 reserve in each regional
  thematic assemblies

• MARCH / APRIL
• FIRST ROUND OF REGIONAL THEMATIC ASSEMBLIES
• Accounting of the annual investment plan-previous
  year
• Presentation of the year plan for the approved
  budget
• election of delegates (1 DEL for 20 persons) for
  the forum of delegates

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Debating a Priority in Partenon Region
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Voting a Priority Proposal at a Plenary Session
in one of the regions of the City
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OP - THE PROCESS VI

• JULY / AUGUST
• THE START OF MAKING THE BUDGET
• Executive works to make residents demands
  compatible to institutional demands
• Prepares broad budget (Expenditure versus
  revenues)
• OP COUNCIL discusses criteria, distribution of
  resources, defines calendar
• Internal rules

30 th SEPTEMBER Budget must be sent to the
Legislative Chamber
30 Th NOVEMBER Budget must be approved by
Legislative Chamber
OP COUNCIL prepares a plan of investment with
detail list of public works activities
prioritized by the council
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The OP Council Meets open for the public
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PERCENTAGE OF INVESTMENTS FROM THE TOTAL
EXPENDITURE OF THE MUNICIPAL ADMINISTRATION
YEAR PERCENTAGE OF INVESTMENT () 1989
3.20 1990 10.00 1991 16.30 1992 17.00 1993
9.76 1994 15.00 1995 13.40
Combined effect from the local fiscal reform and
the deconcentration of resources by the new 1998
constitution
More capacities to invest
SourcePMPA/SMFFedozzi,1997
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EVOLUTION IN TERMS OF RESIDENTS PARTICIPATION IN
THE PARTICIPATORY BUDGETING - OP
YEAR ORGANIZATIONS TOTAL NO. OF
PARTICIPANTS 1989 250 780 1990 467
976 1991 503 3.694 1992 572
7.610 1993 614 10.735 1994 11.247 1995
14.267
Participants in the 1 rst and 2 nd rounds of
regional assemblies Participants in 1 rst and
2nd rounds of regional and thematic assemblies
The start of preparatory meetings makes
difficult to define accurately the total member
of organoizations
Sources CRC/PMPAFedozzi , 1997
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Organs Municipal Administration
Community Organs
Institutional Organs Participation
Regional Assemblies
MAYOR
Popular Councils Community Coalitions Regional
Municipal Secretariats
GAPLAN Planning Unit
CRC Coord Relation Communt.
OP COUNCIL
16 FORUM Delegates
FORUM Planning Assist.
Community Organizations
OP Regional Coordinators
Profession Entities
Thematic Plenary Sessions
Thematic Coordinators
Inhabitants of the Region
Civil Society Org. Social Movements
5 FORUM Thematic Delegates
FORUM Thematic Coordinators
LEGISLATIVE CHAMBER
Source PMPA/Fedozzi, 1997
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Prioritization method with objective criteria
WEIGHT
CRITERIA
1. Popular Mobilisation The greater the
mobilization the greater is the priority 2.
Contribution of the region for the overall
organisation of the city The greater the
importance the greater is the priority. 3.
Population in areas of great need in each
micro-region The greater the number of vilas
with greater number of inhabitants the greater is
the priority. 4. Basic Need The greater the
concentration of need (carencia) the greater is
the priority.

FINAL GRADE
GRADE
Budget YEAR 1990
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Prioritization method with objective criteria
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Improving the method towards objectivity
Budget YEAR 1992
1. NEED IN SERVICES OR INFRASTRUCTURE WEIGHT
3 Until 25 Grade 1 From 26 to
50 Grade 2 From 51 to 75 Grade 3 From
76 onwards Grade 4
2. POPULATION IN AREAS OF MAXIMUM NEED IN
SERVICES AND INFRASTRUCTURE WEIGHT 2 Up to
4,999 inhabitants Grade 1 From 5,000 to
14,999 inhabitants Grade 2 From 15,000 to
29,999 inhabitants Grade 3 Above 30,000
inhabitants Grade 4
3. TOTAL POPULATION OF THE REGION WEIGHT 1 Up
to 4,999 inhabitants Grade 1 From 50,000 to
99,999 inhabitants Grade 2 From 100,000 to
199,999 inhabitants Grade 3 Above 200,000
inhabitants Grade 4
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Improving the method towards objectivity
4. PRIORITY CHOSEN BY THE REGION WEIGHT 2 From
4th priority onwards Grade 1 3rd Priority
Grade 2 2nd Priority Grade 3 First
priority Grade 4
CONCRETE EXAMPLE Region 6 - Northeast Pavement Cr
iteria weight x grade total Need 3
x 2 6 Population in need 2 x 3
6 Total Population 1 x 1 1 Priority of
the region 2 x 3 6 TOTAL POINTS 19 19
points is the basis to decide in comparison to
other regions the amount of the budget that will
be allocated for pavement in Northeast.
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CONCRETE EXAMPLE Region 6 - Northeast PAVEMENT To
tal points 19 Percentage to be allocated
6.35 Total to be distributed 1,335
meters Roads classified for 1992 01. Avenue Dez
de Maio Continuation Rua Sebastiao Barreto 1,000
meters 02. Road K of Vila Safira Nova From Rua
Mocambique 300 meters TOTAL ALLOCATED 1,300
meters CREDIT 34 meters
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• RESULTS IN 12 YEARS OF PT ADMINISTRATION
• 2,000 projects and actions works prioritized,
  implemented and
• paid via OP
• All works prioritized by the population who were
  historically excluded from local government
  intervention
• Prioritized sectors water and sanitation, tenure
  regularization, housing, street pavement,
  education, health and public transport
• In 11 years 2,725 works and demand for services
  approved worth nearly US900 million, 85 of them
  concluded and the rest already initiated (Jornal
  Correio do Povo, 4/5/2000).

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OP - CONCLUSION Based on Porto Alegre (OP
established in 1989 )
1- OP means systematic consultation to the city
population 2- OP means direct participation in
decision making about the utilization of public
funding 3- OP exercises transparency in
municipal public fund allocation 4- OP forges
institutional building via continuous Community
Particiaption in allocation prioritization of
public investments 5- OP means objective and
measurable norms conduct in public affairs 6-
OP means the end of personal decision making -
clientelism