FISCAL DECENTRALIZATION INITIATIVE IN MOLDOVA

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FISCAL DECENTRALIZATION INITIATIVE IN MOLDOVA

• Soros Foundation-MoldovaPublic Administration
  and Good Governance Program2004 - ongoing

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The Components of the FD Project in Moldova

• development of a report on fiscal
  decentralization situation in Moldova (2004)
• organization of six roundtable discussions with
  all the main stakeholders (2005)
• participation in FDI regional forums (2004-2005)
• technical assistance to the Moldovan Ministry of
  Finance (2005-2006)
• organization of the FD Forum in Moldova (March
  2006)
• post-Forum activities and dissemination (2006)

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The Main Partners

• FDI OSI/LGI Budapest (financial support for FD
  Forum and TA MoF Project)
• Ministry of Finance of Moldova (participation in
  roundtable discussions, FD Forum, implementation
  of TA MoF Project, post-Forum activities and
  dissemination, Editorial Board and Steering
  Committee)
• Parliament of the Republic of Moldova (roundtable
  discussions, FD Forum, post-Forum activities,
  Steering Committee)
• NGOs Coalition for FD (Business Consulting
  Institute, CASE Moldova and Counterpart) (the
  implementing group of NGOs, participated from the
  beginning in all events)
• Local independent experts (participated in all
  events organized since 2004 till present and
  developed studies)
• Center for Fiscal Policy, Russia (cooperated with
  the NGOs Coalition during the Forum preparation
  stage, participation in one roundtable
  discussion, FD Forum, TA MoF Project)
• Local Government Associations (participated in
  all events, Editorial Board and Steering
  Committee)
• Local Authorities of both levels (participated in
  all events and Steering Committee)

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Other Partners and Local Donors

• Economic Growth and Poverty Reduction Strategy
  (EGPRS) Participation Council Secretariat
  (co-financed 2 roundtable discussions)
• Ministry of Local Public Administration (started
  to participate in FD events from the period it
  was created - June 2006)
• Local Government Reform Project (USAID)
  (participated in roundtables, co-financed the FD
  Forum)
• UNDP (co-financed the FD Forum)
• National Coordination Unity for Public
  Administration Reform (Government ofthe RM)
  (participated at FD Forum, review of studies)

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FDI and Soros Foundation- Moldova Cooperation

• The close cooperation was focused on the
  following types of activities
• Forming groups of experts for participation in
  FDI regional forums
• Conducting needs assessment in the field of
  fiscal decentralization in Moldova in January
  2005, including visits to the Ministry of
  Finance, the Parliament, active NGOs
• Providing technical assistance to the Ministry of
  Finance of Moldova
• Organizing the Forum for Fiscal Decentralization
  in Moldova
• Organizing FDI visits to Moldova
• Organizing visits to Moldova of Center for Fiscal
  Policys staff TA MoF projects external
  consultant

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The Role of FDI

• The FDI carried out the needs assessment in
  Moldova
• As a needs assessment follow-up, the FDI
  developed the ToR for the TA MoF Project based on
  the MoF request. The ToR was approved by the
  Moldovan MoF
• The FDI approved the TA and FD Forum projects
  funding in April 2005
• The FDI facilitated negotiations with the MoF
• The FDI selected the external consultant for the
  TA project Center for Fiscal Policy from Russia
• The FDI organized a study visit for the Moldovan
  MoF team to the Hungarian MoF

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Cooperating Framework, Participatory Aspects

• A Memorandum of Understanding between the
  Ministry of Finance, OSI/LGI Budapest and the
  Soros Foundation-Moldova, which stipulates the
  responsibilities of the parties in the FD project
  implementation process, was signed in September
  2005
• A Steering Committee (SC), which monitors the
  project implementation and ensures the
  participation and the transparency of decision
  making was created. The SC consists of
  representatives from all interested stakeholders
  Ministry of Finance, Ministry of Economy,
  Parliamentary Committees, LGs and NGOs
  representatives, academics and independent
  experts.
• An Editorial Board was created to ensure high
  quality of developed papers. The EB consists of
  MoF representatives, NGOs Coalition, academics,
  associations of mayors, independent experts,
  other active NGOs representatives. The EB members
  are also members of the Steering Committee.

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Additional Activities and Dissemination

• Three regional seminars before the Forum
  organization
• Eight regional mini-forums for dissemination of
  results and discussion of Forum recommendations
• Over 10 presentations on TV and national radio
• Over 15 publications and press-releases in
  mass-media
• Working meetings with MoF staff at least 10
• One public debate

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Opportunities, Achievements, Impact

• Increased collaboration between all participants.
  Organizations which never cooperate before
  started to work together
• The partnership between governmental and
  non-governmental organizations is established
• The MoF became more cooperative in relationship
  with various non-governmental stakeholders,
  welcomed cooperation with NGOs, and proposed
  monthly joint working sessions
• A new reform in the field of public
  administration is initiated by the Parliament
  the Law on Decentralization, the Law on Local
  Public Administration and amendments to the Law
  on Local Public Finances were approved in the
  first reading. The need to develop the Law on
  Decentralization was discussed for the first time
  during the Forum
• Wide participation of MoF representatives during
  both days of the Forum it has been commended by
  foreign experts, donors, the Parliament and other
  participants

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Opportunities, Achievements, Impact

• Some experts mentioned that the Forum was a
  professional event with no political affiliation
  unlike many others
• Participation of all main Associations of Local
  Authorities - Association of Mayors and Local
  Collectivises from RM, League of Mayors
  Association of RM, Association of District
  Presidents and Councillors of RM, Association of
  Mayors from TAU Gagauzia.
• USAID, UNDP, World Bank representatives
  participated during the Forum and commended the
  high importance of the event for Moldova
• The local expert community was strengthened
• A participatory mechanism was developed (Steering
  Committee and Editorial Board)
• The Concept for the Strategy for Fiscal
  Decentralization has been developed

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Opportunities, Achievements, Impact

• 43 organizations (institutions of LPA, NGOs and
  experts) have signed the Memorandum regarding the
  strengthening of local autonomy in the Republic
  of Moldova and created the Coalition for Fiscal
  Decentralization
• Over 60 recommendations on amendments of the
  legal framework on fiscal decentralization are
  developed and sent to the Parliament, MoF and
  Ministry of LPA
• The edition Fiscal Decentralization challenges
  for Republic of Moldova is published
• 10 study papers and 2 case studies have been
  developed
• 40 national and foreign experts were involved
• Mass-media campaign is unfolded
• The project web page is launched www.dfm.md

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FD Project in Moldova Lessons Learned

• It was very difficult to launch and implement
  activities when the country and the Chisinau city
  were in the pre-election and right after election
  periods (2005 Parliamentarian elections and
  four rounds of local elections in Chisinau. The
  former Minister of Finance participated in local
  elections)
• Participatory mechanisms should be carefully
  developed and planned before launching an
  initiative
• Establishment of partnerships in every
  participatory process needs time and efforts from
  all stakeholders
• A neutral facilitator is needed for a successful
  policy dialogue
• Partnership building needs well-informed actors
• Communication strategies are necessary for a
  greater impact

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FD Project in Moldova Lessons Learned

• The consolidation of efforts are needed for
  better and successful promotion of changes and
  improvements in the field of PA and
  decentralization
• It is necessary to build upon capacities of local
  experts and to develop their abilities for
  cooperation in groups
• It is needed to have excellent communication and
  conflict-management skills to be able to get over
  frictions, which can appear because of excessive
  politic affiliation of all involved actors
• The cooperation with state institutions has some
  risks they would like to have control over any
  activity and to be permanently informed about
  every step

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FD Project in Moldova Further Needs

• Assistance to the MoF in implementation of the
  newly developed system of intergovernmental
  transfers
• Consolidation of local capacities and expertise
  through continuing participation in regional
  events
• Exchange visits between countries that
  implemented similar projects within FDI
• Trainings for the MoF, the Ministry of LPA and
  the Parliamentarian Commissions on mechanisms of
  cooperation with civil society in the field of PA
  and FD, mechanisms for reform implementation and
  coordination of efforts
• Mentoring program for governmental institutions
  in the field of PA and FD
• Establishment of the systemic approach for the
  elaboration and adjustment of legal framework in
  the field of public administration and local
  public finances
• Foreign expertise in the field of PA reform and
  adjustment to EU standards

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Soros Foundation - Moldova

• THANK YOU FOR YOUR ATTENTION!
• Rodica Mocanu-Nosko, Public Administration and
  Good Governance Program Director, Soros
  Foundation-Moldova