Participants did not ignore the issue of corruption. There are simple questions of fact that remain to be fully answered across the national cases of CDFs: who is corrupt? What actions are taken against individuals and organizations accused of corruption? What type of rules and practices can reduce the potential for corruption and misuse?
Participants also addressed several local-level issues. CDFs can represent a quick fix and fiscal illusion, or free money, whose investment can actually increase the burden of long- term expenditure on the central government. On the other hand, it can also reflect the priorities of local communities. So it is important to distinguish among the articulation of local demand, by which MPs identify CDF projects, from local government administration, which is a separate issue of local government managing the Fund disbursements. The challenge is not for CDFs to replace existing service delivery from local or central government, but to define a relationship with local governments that addresses potential overlap, contradiction and redundancy with current service delivery.
This conclusion leads naturally to the identification of principles and rules of CDF accountability that contributes to a constructive framework for procurement of goods and services in CDFs and for oversight of their implementation. It not only concerns which entity will exercise oversight, but asks how that system of oversight will fit into the overall policy making process that is increasingly transparent. The current absence of institutionalized accountability may make CDFs popular with politicians and administrators who view them as opportunities to advance personal interests and agendas. But this absence of accountability also leads CDFs to become unpopular with groups that are cut out of the policy process and/or cut out of the investments that are being made. The International Budget Partnership’s documentary of MUHURI’s social audit in Mombassa, Kenya demonstrated the absence of otherwise institutionalized mechanisms of accountability or transparency in Kenya’s CDFs.
Enhanced transparency appears to require a separation and balance of powers. A CDF that is centrally controlled by the executive (as in Ghana) and is strictly accountable to the President or Prime Minister may leave little room for transparency in its operations. However, it would seem relatively simple to enhance transparency in CDF operations that would lead to more effective accountability of CDFs – either through legislation expanding freedom of information and/or enhancing the increasing transparency and openness of government administration more fully.
Politics and Sustainability
The sustainability of CDFs as tools of decentralized and effective development will rest both on the efficiency and effectiveness of its implementation and on its political acceptability to stakeholders throughout the political system. The current popularity of CDFs appears to rest mainly on the generally held political calculus in which centrally placed politicians bring home development resources to local communities and groups in exchange for political support. The institutionalization of CDFs as a mechanism of resource allocation across party lines can help to nurture a loyal opposition even over the objections of executives. At the same time, many MPs believe that CDFs have