Thesis (MPA)--Stellenbosch Univeristy, 2007. / ENGLISH ABSTRACT: Decentralisation is a growing phenomenon worldwide. However, the detail of its implementation determines whether desired objectives are achieved or not. The thesis extensively interrogates this concept from economic, philosophical and political theoretical perspectives, with emphasis on the economic rationale. An international perspective has also been utilised for informing the investigation. Reference is made, in this regard, to both federal and unitary states of the developed and developing world. Botswana, a unitary and developing African country, has been found to be facing more or less the same challenges that undermine the desired benefits of fiscal decentralisation in all developing countries. However, political maturity (which is a prerequisite for decentralisation reforms) - a predictably stable commodity in Botswana -sets it apart from most other developing, if not all, African countries. With regards to decentralisation, a number of considerations framed the analysis. Firstly, the established consecutive approach to Botswana 's centralised economic planning and management has been found to be counter-productive to the financial decentralisation process. This has resulted in an over-regulated local public sector that is not conducive for taking stock of local initiative and being innovative in local affairs, mainly due to an ambiguous institutional framework. Secondly, an ad hoc financial transfer mechanism, that is neither stable nor predictable, clearly undermines integrated financial management and strategic fiscal planning at municipal level. Thirdly, a one-size-fits-all approach to the assignment of expenditure responsibilities to all municipalities, small and large, as well as urban and rural, serves as another constraint. Finally, a lack of stable and buoyant sources of own revenues, as well as inadequate capacity to utilise fully the already existing internal revenues, has created grant economies that survive on a principle of beggar-thyneighbour to actualise their mandates. This? in turn undermines their? significance for the electorates at local level who turn to the national government even for minor local issues that should be addressed within the areas of local jurisdiction.The thesis concludes with recommendations regarding a redesign of the institutional framework, intergovernmental financial transfers, expenditure assignments and generation of internal revenue. It is critically important that the Government of Botswana should develop a strong policy framework, build a strong consensus within the political and bureaucratic circles and coordinate and integrate these reforms through strong capacity-building mechanisms at local governments. Finally, the capacity of the national government to monitor the process cannot be overemphasised. That is, the decentralisation process should initially be centralised with gradual decentralisation processes to allow for flexibility well aware of the fact that decentralisation structures are always in transition. / AFRIKAANSE OPSOMMING: Desentralisasie is wel 'n wereldwye verskynsel, maar suksesvolle implementering vereis aandag aan detail. Die desentralisasiekonsep word in hierdie tesis grondig ondersoek vanuit 'n ekonomiese, filosofiese, sowel as politieke perspektief. Die rol van ekonomiese beginsels in die desentralisasieproses geniet spesiale verwysing. Om die ondersoek so omvattend moontlik te maak is internasionale bronne geraadpleeg, afkomstig vanuit sowel federale as unitere state asook uit ontwikkelde en ontwikkelende lande. Botswana, 'n ontwikkelende Afrika land met 'n unitere staatsvorm, ondervind uitdagings wat, soos in enige ander ontwikkelende land, die voordele van fiskale desentralisasie ondermyn. Politieke volwassenheid en stabiliteit is van die voorvereistes waaraan 'n staatsbestel moet voldoen om desentralisasie suksesvol toe te pas. Gelukkig skiet Botswana in die opsig geensins tekort nie, inteendeel, dit is juis hierdie eienskap wat hom van die meeste - indien nie alle ander - Afrikalande onderskei. Heelwat oorweging is geskenk aan die bepalende faktore rondom desentralisasie. Botswana se gevestigde gesentraliseerde ekonomiese beplanning- en bestuurstelsel is gei'dentifiseer as die belangrikste teenproduktiewe struikelblok wat die finansiele desentralisasieproses ontspoor. Kenmerkend van 'n sentralistiese institusionele raamwerk is 'n oorgereguleerde plaaslike openbare sektor wat nie die skep van eie inisiatief en ondernemende bestuur bevorder of ag op die belangrikheid daarvan slaan nie. Tweede in belangrikheid is 'n onstabiele, ad hoc finansiele oordragmeganisme waarop daar nie peil getrek kan word nie en wat pogings om gei'ntegreerde finansiele bestuurspraktyke en strategiese fiskale beplanning op munisipale vlak te vestig, belemmer. Die derde hindernis is die owerhede se onwilligheid om te besef dat daar geen pasklare benadering bestaan wat by al die uiteenlopende tipes (in terme van grootte en ligging, plattelands tot stedelik) plaaslike besture verantwoordelik bestedingspraktyke sal vestig nie. Laastens is 'n wydlopende gebrek aan stabiele en lewenskragtige, eie inkomstebronne, sowel as onvoldoende kapasiteit om reeds beskikbare, interne belastinginkomste doeltreffend aan te wend, nadelig vir plaaslike regering. Pogings om te verseker dat 'n eie plaaslike raad so 'n groot as moontlike toekenning uit die staatskas ontvang, veroorsaak dat aanliggende rade dan nie hulle regmatige deel ontvang nie. Plaaslike rade se oormatige afhanklikheid van die sentrale regering vir finansiele oorlewing, ondermyn die legitimiteit van plaaslike politici. Laasgenoemde soek gewoon te maklik die oplossing vir 'n plaaslike probleem by die sentrale regering, eerder as om dit self aan te durf Die tesis sluit met aanbevelings oor 'n herontwerpte institusionele raamwerk wat kan lei tot sinvoller finansiele tussenregeringsoordragte, taakgedrewe uitgawes en die skepping van eie, interne belastingbron. Dit is van kritieke belang dat die regering van Botswana 'n stewige beleidsraamwerk ontwikkel en dan konsensus daaroor verkry tussen die politici en burokrasie. Die integrasie en ko-ordinasie van hierdie hervormings kan slegs geskied indien dit gepaard gaan met lewenskragtige kapasiteitsontwikkeling op plaaslike bestuursvlak. Die sentrale regering sal egter eweneens eie kundigheid moet ontwikkel om die proses te monitor, want die desentralisasieproses sal aanvanklik vanaf die middelpunt geskied en geleidelik uitkring. Dit sal buigsaamheid en begrip verg omdat desentralisasie in wese voortdurende oorgang impliseer.