MUNICIPAL
REFORM
MANUEL CERECEDA
V.
I. INTRODUCTION
The field
of municipal services is undoubtedlyone of the areas in which the structural
transformation of the Chilean publicsector over the last several decades can
most clearly be seen.
The introduction
of organizational innovations,transferal to the municipal level of services
which in the majority of developingnations are administered by a centralized
public apparatus coupled withthe transfer to the private sector of a variety
of services which in thepast had been provided by local government directly
are some of the elementswhich characterized the formulation of a new profile
for Chile's municipalities.
The municipal
reform process can be separatedinto three successive stages:
- The period
prior to 1976 during which thelegislation passed in 1955 remained in effect.
As of 1973, however, Mayorswere appointed by the Executive Branch.
- The second
stage commenced in 1976 with passageof new legislation on Municipalities. The
regulations contained in thisDecree Law (number 1,289) constituted the beginning
of the municipal transformationin terms of administration and internal organization.
- Lastly,
the third stage witnessed the mostprofound changes in municipal institutions,
beginning with passage in 1980of Decree Law 3,063 on Municipal Revenues; a set
of legal norms which, inaddition to restructuring the organization of the nation's
municipalities,empowered local governments to take responsibility for the administrationof
services in such areas as health care, education and youth centers, whichuntil
that time had been administered by the central government.
Today, the
results of these changes are perceivedas clearly favorable and although there
is broad consensus on the need toreform the way local officials are selected
-- they are currently electedthrough an indirect mechanism -- there is widespread
agreement on the needto maintain the fundamental lines of municipal institutionality.
II. THE
OLD MUNICIPAL SYSTEM
1. BACKGROUND
INFORMATION
Under the
old municipal system, local governmentwas conceived more as an opportunity for
participation than a service-providingentity. Thus, a large portion of the development
attained by local governmentswas limited to the participation of residents in
the election of city councilmembers. In addition to serving as representatives
of the community at themunicipal level, these elected officials also selected
the Mayor from amongtheir ranks and constituted the body responsible for running
the municipality.
The nature
of municipalities as an arena forparticipation -- a concept which existed prior
to the reforms undertakenat the end of the 1960's -- has its roots in Chilean
history.
In essence, the nation's municipalities werebased on the "cabildos" or citizens' meetings formed bythe Spanish. Such institutions were of particular importance in the early19th century when the Chilean Republic was in formation. For example, thehistorical importance of this institution is demonstrated
by the fact
that Chilean Independence was declaredon September 18, 1810 in an open cabildo,
or a meeting of neighbors.
If we examine
the evolution of the powers andresponsibilities of Chilean municipalities through
the course of this century,it is clear that administration has alternated between
decentralization,or local government autonomy, and the centralizing and statist
goals thatmarked the decades prior to the reform.
In 1891,
as the 19th century drew to a close,legislation known as the "Law on Community
Autonomy" was put forwardby conservative politicians based on Swiss experience
with local participation.Under this framework, the independence of municipalities
was enshrined andimportant responsibilities, including education, public health
and policewere handed over to local officials as additions to their classic
task ofproving sanitation services.
Nonetheless,
Chile was not spared the centralistphenomenon which have affected developing
countries -- and the nations ofLatin America in particular -- hampering the
incipient autonomy of the nation'smunicipalities. Thus, the intervention of
centralized powers in local affairsfirst appeared in the articles of Municipal
Law 2,950 of 1915 and was subsequentlysustained in the nation's Constitution
according to the reform of 1925.
During the
following decades, municipal legislationwas accrued which sought to strengthen
the Executive Branch and centraladministration agencies.
The process
of reducing municipal powers foundits full legal expression in 1955 with the
passage of Law 11,360 in whichthe conditions of municipalities at the time were
accurately described:reduced resources, which in the majority of cases were
insufficient to covereven the most basic of operating costs; limited powers;
excessive politization;and a concentration in municipal hands of activities
which could have beenconducted by the private sector.
A well-known
Chilean author once describedthe nation as having "a crazy geography."
Upon examining the country'sgeographic and natural conditions, the logic behind
decentralization becomesperfectly clear. Nonetheless, these arguments were not
sufficient to curbthe move toward centralist ideas which were implemented without
mercy throughthe 1970's in the area of municipal services as well as other realms
ofnational activity.
An illustration
of the absurdity of this situationis that the city of Santiago, where the Executive,
Legislative and Judicialpowers were concentrated, is located 2,074 from the
country's northernmostmunicipality and 2,050 kilometers from its southernmost
township.
Despite
these distances, prosaic decisionsof importance solely at the local level, such
as the hiring or replacementof a teacher, or the installation of a drinking
water or sewage system,had to be resolved in the nation's political and administrative
capital.
The combination
of factors noted earlier whichled to the crisis in the Chilean municipal system
(lack of resources, participationin activities which could have been conducted
by the private sector, limitedpowers and excessive politization) was evident
in the specific practiceswhich sparked the system's demise and fueled the loss
of confidence in municipalitiesas a mechanism for resolving local problems and
needs.
City council
members, who constituted the localdecision-making body, increasingly placed
higher priorities on the interestsof the parties they represented than on those
of the local community.
Moreover,
the Mayor, who was in theory thehighest ranking official at the municipal level,
was not elected by directvote, but was rather selected by the Council from amongst
its members. Thisoften meant that the power of the Mayor was restricted and
reduced by thepartisan coalition that had brought him/her to power.
Furthermore,
the positions of Mayor and citycouncil member were ad-honorem, without
pay, and therefore such officialscould rarely dedicate themselves to governance
on a full-time basis andwere forced to split their time between personal activities
and those requiredby public office.
Of the attributes
or powers the Chilean municipalitiesretained even through the 1970's, the following
are the most relevant:
- In the
area of public safety, the municipalitieshad certain powers to prescribe regulations
and apply fines to regulatethe consumption of alcoholic beverages in public
places, decree obligatorynorms in the areas of public transportation, exercise
administrative controlover the staffs of the Juzgados de Policía Local,
(local courtswhich administer justice in matters of minimal importance).
- Granting
of commercial, professional andindustrial licenses and receiving any revenues
such licenses might generate.
- Providing sanitation services in public areas.
- Authorizing
the construction of homes orbuildings, the design of a community regulatory
plan, approving plans fornew housing developments and determining the names
and numeration of streets.
- Granting
driver's licenses and motor vehicleregistrations.
- Authorizing
construction and maintenanceof town squares, playing fields, parks and gardens
with municipal resources.
- In the
area of community services, municipalitieswere authorized to construct and maintain
public electrical lighting; regulatethe placing of commercial advertisements
and public announcements; constructschools, libraries and school museums; pave
streets or work with specially-createdState organizations in doing so; build
drinking water and sewage systems,cemeteries, slaughterhouses and municipal
markets.
The powers
granted to the municipalities had,however, two insurmountable limitations.
The first
was the endemic lack of resourcesat the municipal level. Local governments were
financed on the basis ofthe revenue they generated and contributions from the
national governmentwhich were included in the nation's annual budget. Such allocations
wereneither regular nor periodic and depended, most of the time, on the amountof
influence local authorities held with the Executive and Legislative branchesof
government;
The second
was the creation, by the centralpowers, of Ministry-dependent agency which was
charged with the same functionsas the Municipality at the local level.
In practice,
the overlapping of attributesand powers between municipalities and organizations
dependent on centralizedadministration meant that, for example, in paving a
street, the Directionof Roadways of the Ministry of Public Works, the Ministry
of Housing andUrbanization or the local Municipality could all take part in
the project.
As tends
to occur wherever resources are scare,disputes among potential executor agencies
tended to focus less on determiningwho should implement the project and more
on who should not participate.
As has been
noted, municipalities engaged inactivities or served functions which, by nature,
could have been adequatelychanneled through the private sector. This is the
case with meat processingplants and slaughterhouses, cinemas and theaters, markets,
etc.
The lack
of objective technical proceduresin prioritizing the investment of the limited
resources that were availablemeant that communities grew in an irregular fashion,
without a long-termdevelopment plan.
An additional
distinctive aspect of the municipalsystem prior to the reform was the dearth
of professional and technicalstaff qualified to plan and implement local development
projects that couldbe financed, and would be of long-lasting and real social
benefit.
With this
data in mind, a discussion of potentialreforms to the municipal system commenced.
These reforms sought to ensurean acceptable level of efficiency in the generation
and administration ofresources among municipalities and incorporate the same
parameters utilizedby private companies seeking success in their respective
areas of work intothe municipal system.
II. THE
SEARCH FOR SOLUTIONS
As has been
noted, the search for new structures,systems and procedures in the field of
municipal services in Chile was neitherautomatic nor instantaneous, but was
rather the result of a long, sustainedprocess of changes in the legislation
and regulations controlling the functioningof local government.
The following
is a brief discussion of eachof the areas which fall under municipal management,
its problems or weaknessesat the time of the reform and the solutions that were
implemented in aneffort to overcome existing obstacles.
For these
purposes, we shall divide the analysisinto three areas:
1. Administration
2. Technical, Financial and Planning Area
3. Municipal
Services
1. ADMINISTRATION
The primary
weaknesses in this area prior tothe reforms were related to the everyday administration
of municipalitiesand were derived from a lack of profesionalization among key
personnel,the dearth of an appropriate organizational structure and the lack
of modernprocedures that would have made it possible for local government to
functionefficiently.
Initial
improvement in local management cameunder the guise of nationwide policies aimed
at decentralizing the administrationof the State. The country was divided into
12 new, administratively autonomousregions and a Metropolitan Area. These subdivisions
were granted specificresources and their highest-ranking official -- a Regional
Governor or Intendente-- was authorized to coordinate and systematize
the work of public servicesin his/her region.
It terms
of the legal framework which regulatedthe administrative modernization process,
legislation was oriented towardachieving two objectives: decentralizing the
financial decision-making process(Law on Municipal Revenues) and re-organizing
the internal functioning ofmunicipalities (Organic Law).
Furthermore,
the Constitution expressly notedthe role of municipalities, defining them as
"Corporations of PublicLaw, with their own legal status and patrimony,
whose purpose is to satisfythe needs of the local community and ensure its participation
in the economic,social and cultural progress of the township."
As a result
of these modifications, profoundchanges in the administrative and organizational
structures of the Chileanmunicipal system were introduced, establishing a new
set of institutionsaimed at instilling efficiency and rationality in municipal
management.Among the most important innovations in this area were the following:
a. Common
Municipal Fund
The Common
Municipal Fund, a system of financingcreated in 1981, consists of a national
fund composed of contributions frommunicipalities and the national government.
These contributions are subsequentlydistributed to each township in accordance
with pre-established parametersincluding the socioeconomic situation in each
community, number of inhabitants,etc., in order to allocate the proper amount
of resources to each community.
The concept
behind the Common Municipal Fundwas borne of the need to find a way to redistribute
income between "rich"and "poor" communities. The Fund has
been entirely successfulin achieving this goal; today a small number of municipalities
contributean important portion of the resources which are distributed among
the nation's325 townships.
The Fund's
operating mechanism is fairly simple:each town or community provides a percentage
of its revenue -- those generatinggreater revenues contribute a larger share
to a central pool and withdrawa smaller proportion at the time of distribution.
This benefits the municipalitieswhich have higher indexes of poverty or a larger
number of inhabitants.
b. Regulations
on personnel
A second
important aspect in improving theadministration of Chilean municipalities was
the modifications made to regulationson personnel. As noted earlier, existing
legislation was so rigid that itprevented municipalities from hiring the best
personnel needed to fulfilltheir obligations -- neither on a permanent nor temporary
basis.
According to data collected in 1975, of a totalof 20,722 municipal employees, only 8% were professionals (holding collegedegrees) while 67% were auxiliary and service personnel and concierges.
Under the
reform plan, new full-time personnelwere hired in municipalities throughout
the country. The primary characteristicof this shift was the increasing profesionalization
of employees and themaintenance in absolute terms of the overall number of municipal
workers.
Furthermore,
since municipalities were authorizedto subcontract services with the private
sector which had traditionallybeen implemented directly by the municipality,
the drastic reduction inauxiliary and service personnel was more than justified.
Municipalities were also authorized to contractpart-time or
temporary
personnel, through the payment ofhonoraria, for services that the full-time
staff was not in a position toprovide either because of a lack of specific knowledge
or shortage of time.Under this system, municipalities were able to enlist the
assistance ofqualified professionals from the private sector in designing and
evaluatingprojects in infrastructure, architecture, roadwork, equipment, computersas
well as areas related to the implementation of social and local developmentprograms.
c. Introduction
of the concept of the municipalityas a service-provider
A third
element which must be noted in theadministrative modernization of local government
lies in a new conceptionof the type of specific role a municipality should play.
The idea
of the "Benefactor State"continues to persist in many developing nations.
Under this system, potentialusers of the services provided by public entities
are passive subjects farremoved from social policy.
The reforms
introduced in Chile, in both municipaland social areas, coincided in their efforts
to enhance objective mechanismsof access to programs and social services. Thus,
the role of public employeeswas reduced to that of intermediary, whose primary
responsibility was providinginformation and processing the benefits the citizenry
aspires to receive.
This reduction
in the margins of discretionin the management of municipal services has a variety
of advantages as it:reduces the prospects for administrative corruption; guarantees
that resourceswill be focused on the most needy and those with the least lobbying
power;permits decisions to be made on the basis of technical parameters; and,from
the administrative standpoint, it reduces the number of bureaucraticprocedures
needed to solicit a service or benefit.
From the
point of view of the ordinary citizen,the concept of the "municipality
as a service-provider" has anadditional advantage: upon requesting municipal
assistance, he/she doesso from a position similar to that of a "client"
at a privatefirm who is requesting a service with widely known characteristics
and forwhich the requirements for receiving such a service are absolutely clear.
This new
style of municipal management is todayparticularly useful in administering housing
programs, assistance pensionsand subsidies as well as such programs the "Presidential
Scholarships"available to students. In all of these cases, the municipality
acts as anintermediary between the petitioner and the Ministry or other centralizedagency.
Upon registering for a benefit in these and other areas, peoplehave clear information
as to the likelihood of obtaining the service orcredit requested and, more importantly,
what they can do to improve theirchances (such as increasing savings upon applying
for participation in housingprograms or, for students, improving grades).
In order
to efficiently fulfill these new functionsof mediation and the furnishing of
social services, municipalities had toadjust both administratively and technically.
An important factor in thismodernization process was the installation of computer
systems which todaymake it possible to access accurate information on the population
benefittingfrom programs and services. Furthermore, this information can be
continuallyupdated, thereby avoiding duplicity in the granting of benefits and
improvingthe focalization of resources aimed at assisting lower income groups.
Given the
enormous distances between urbancenters and many municipalities, particularly
in the farthest flung reachesof Chile, the availability of computer systems
has been a crucial factorin the implementation of the so-called "Social
Network," a setof programs, plans, subsidies and services designed to combat
extreme povertyand facilitate social development in Chile.
The operational
efficiency obtained by themunicipalities in administering large-scale selection
social benefit programshas resulted in an additional phenomenon which is worthy
of note: a consistenttransfer of responsibility from centralized powers to local
officials.
In truth,
this shift resulted not only fromthe modifications of a legal nature that were
implemented, but also fromvoluntary agreements reached between central agencies
and municipalitiesto conduct joint activities or for the local institution to
take responsibilityfor tasks which could be conducted more efficiently at the
local level.
Thus, municipalities
today participate in aplethora of tasks which were at one time the exclusive
responsibility ofcentralized, nation-wide agencies, including:
- Application processes for housing programs(Ministry of Housing);
- Operation of community-based offices of employmentand work-related training (National Training and Employment Service);
- Operation and administration of day-timecare for minors, pre-schools and open day-care centers (National Minor'sService, National Kindergarten Service);
- Administration of sporting areas (GeneralDirectorate of Sports and Recreation);
- Application and selection process for assistancepensions and family-oriented subsidies (Social Security Service);
- Implementation and co-financing of legalassistance centers (Corporation for Judicial Assistance of the Ministryof Justice);
- Administration of unemployment subsidiesand transitory work programs for heads of household (Ministry of Labor andSocial Security);
- Process of revising and appraising real estate(Internal Revenue Service);
- Administration of elementary, secondary andtechnical-professional educational establishments (Ministry of Education);
- Administration
of primary health care centers(Ministry of Health).
These examples
are just a sample of a widevariety of responsibilities and areas of power which
were gradually transferredto municipalities thanks to the administrative capacity
demonstrated bylocal institutions in efficiently conducting activities which,
as we haveseen, in developing nations are frequently lodged in the upper echelonsof
centralized administration.
In conclusion,
we can state that the decentralizationprocess was made possible thanks to the
efficiency of the municipalitieswhich were able to accept responsibility for
additional tasks by improvingnotably the professional and technical qualifications
of their employeesand incorporating modern administration techniques which were
common preceptsin the administration of the private sector rather than by significantlyincreasing
personnel.
2. TECHNICAL,
FINANCIAL AND PLANNING AREA
An additional
relevant aspect of the processof improving and modernizing municipal services
were the modifications introducedin the technical and financial area, in addition
to the incorporation ofplanning as a key element in municipal management.
The new
concepts incorporated into municipalaction in these areas translated into measures
that were unheard of in publicmanagement at the time.
Of these
innovations, the following are ofparticular significance:
a.
The Creationof Community Secretariats for Planning and Coordination in each
municipality
Hindsight
bears testimony to the appropriatenessof the legal requirements Chile imposed
on its municipalities obligatingthem to create technical units within their
administrative structure. Thefundamental goal of these units is to provide consulting
services and guidanceto municipal authorities in adopting a community development
strategy.
As noted
in the brief description of the conditionof Chilean municipalities prior to
the reform, one of the primary deficienciesin municipal management was, precisely,
a lack of highly qualified technicalteams which could provide useful information
to the authorities seekingto make decisions regarding the allocation and investment
of resources whichthe municipality received from a variety of sources.
The Community
Secretariats for Planning andCoordination (SECPLACs) filled this void. Composed
of a multi-disciplinaryteam of professionals, SECPLACs evaluate the feasibility
of each projectproposal put forth by the community or by groups within the municipalityitself.
SECPLACs are also responsible for coordinating efforts by similarentities on
the regional and national levels (Regional Secretariat for Planningand Coordination
and the Ministry of Planning, respectively) and are, inpractice, the institutions
charged with seeing to the processing of projectsfinanced by supplemental public
funds, such as those provided by the Fundfor Regional Development and programs
derived from foreign loans.
The procedures
for the preparation, evaluation,presentation and prioritization of social projects
have been standardizednationwide through generally accepted practices which
have been enhancedover time. This has allowed a common "language"
to develop amongentities requiring resources, such as the municipalities, and
the agenciescharged with distributing such funding (regional Governor's offices
andthe central government).
Many of
the improvements in the technical-professionalcapacity of Chilean municipalities
can be attributed to the creation ofthese instances of local administration.
b.
Delegatingan important number of works and services that were traditionally
implementedby public employees to the private sector
Although
under the old municipal system itwas possible to hire private companies to implement
certain initiatives,this option was effectively limited to the construction
of physical projectswhich, in many cases, were performed directly by municipal
employees.
One of the
areas which best illustrates thispoint is that of waste management. In effect,
as recently as 20 years agothe deficiencies in the system for removing domestic
and industrial wastewere the cause of frequent protests and complaints by residents
in a majorityof Chile's townships.
The vehicles
utilized by municipalities toprovide this service were both insufficient in
number and technologicallyobsolete. Furthermore, the municipalities lacked the
power to rationalizethe use of the personnel engaged in these activities, given
the legal rigidityof their schedules and the presence of severe economic restrictions.
Theseconditions were further exacerbated by continuing population growth andrural-urban
migration which at times led to the most dire of situations.
In order
to confront this critical situation,the new municipal legislation authorized
local governments to hire privatecompanies to engage in trash collection. This
procedure was set in operationin the early 1980's and today is common throughout
almost the entire country.
In order
to fully understand the impact ofthis measure, it is important to note that
there were no private waste managementcompanies in Chile at the time this plan
was adopted. Thus, the privatesector was challenged to organize firms specifically
for this purpose.
One interesting
aspect of the implementationof this procedure was the situation among employees
who had worked in municipalSanitation Departments. Once the justifys to domestic
and industrial trashcollection had been sold off, many of the municipal employees
resigned tojoin the newly formed private companies. The reason for this was
that themunicipalities contracted and paid for waste management on the basis
ofthe volume of trash removed. The subcontractors passed this system on totheir
workers in the form of a salary incentive. Under the public system,salaries
were static; under private system, pay was tied to productivity.
Other areas
of municipal action were eventuallyincorporated into the system of contracting
private companies to providetraditionally municipal-run services including:
- Roadwork and infrastructure;
- Preparation of design and architectural projects;
- Construction of civil works;
- Computer services;
- Maintenance of plazas and gardens;
- Maintenance of traffic lights and other trafficmarkings;
- Maintenance and repairs of municipal vehiclesand equipment;
- Implementation
of environmental hygiene projects.
In the technical
field, this new method ofoperating with the private sector constituted significant
progress.
c. Promoting
efficiency as a stimulus forhealthy competition among municipalities in applying
for certain lines offinancing for development projects
In order
to enhance the efficiency of municipalities,a competitive system was designed
to determine the allocation of some typesof resources at the regional and national
levels. The resources utilizedin this program were granted as supplements to
ordinary municipal budgetaryexpenditures (the latter were primarily comprised
of funds derived fromthe Common Municipal Funds and fiscal contributions).
In order
to obtain access to the supplementalfunds (derived from the National Fund for
Regional Development or foreigncredits), municipalities put forth proposals
that could be easily justifiedin terms of technical, economic and social impact.
This meant
that local authorities were requiredto present the needs of their respective
communities within the frameworkof a careful evaluation and accompany their
proposals with background informationand other elements needed to justify the
program. In many communities "ProposalBanks" began to operate in an
effort to respond appropriately and opportunelyto the potential availability
of resources, both in the "public market"and the private sector.
These procedures
for allocating resources havehad several noteworthy advantages and have resulted
in high rates of socialreturn on the supplemental funds provided by the State
in an effort to promotelocal development.
d. The
simplification, rationalization andmechanization of techniques for collecting
fees, licenses and other municipalrevenue
In order
to effectively improve the situationof the municipalities, it was critically
important to provide them withthe resources needed to satisfy the community's
requirements. To achievethis, a restructuring of the mechanisms through which
municipalities raisedtheir own funds was added to the reforms mentioned above.
Municipalities
are empowered to charge feesfor concessions of goods or land, construction permits,
commercial licensesand fees for the transitory occupation of publicly-used national
goods.Furthermore, municipalities may collect fees for those services which
areregulated by law, such as motor vehicle circulation permits and driver'slicenses.
One of the
most important changes in this sensewas the establishment of a policy of charging
users the real cost of theservice being provided. The first area in which this
was applied was thatof fees for domestic waste management. Thus, those users
who required frequenttrash removal or exceeded certain maximum waste limits
were charged higherfees. Furthermore, such users were authorized to forego the
municipal trashcollection service and establish contracts with private companies
to providethis service.
In other
areas, municipalities simplified theirtax and fee collection systems by signing
agreements with commercial banksto receive payment and forward revenue to the
municipalities or, where municipalitieshad banking accounts, deposit the funds
collected directly into those accounts.In the past, there had been a requirement
that all public entities keeptheir resources in accounts with the Banco del
Estado (State Bank).
Another
example of the simplification of operationsrelating to the collection of taxes
or fees was the modifications introducedinto the system of motor vehicle licenses.
Until the 1970's an annual feewas charged and the physical replacement of a
vehicle's metal "licenseplate" -- which varied in color and number
each year -- was required.Naturally, the production of these license plates
on an annual basis forall of the country's vehicles was costly.
In order
to amend this situation, a NationalRegistry of Motor Vehicles was created to
assign each vehicle with a singlelicense plate which would be valid throughout
the vehicles usable "life."Municipalities then collected an annual
fee for authorization to utilizedthe roadways ("circulation permits")
instead of charging for thephysical license plates. The incorporation of computer
systems in this areawas also a boon to its improved functioning.
Lastly,
municipalities were empowered to dictateordinances to set fees for those services,
concessions or permits not coveredin existing legislation.
e. Creation
of nationwide, standardized,modern financial mechanisms
Just as
it is possible to determine how successfula private business is by examining
its annual report and budgetary performance,it was believed that the performance
of municipalities could be measuredthrough similar mechanisms.
First, municipalities
were required to preparean annual budget which clearly stated their expected
sources of revenue.In addition, in an effort to make local governance more transparent,
municipalitieswere required to make their annual financial statement public.
The existence
of mechanisms of redistributionsuch as the Common Municipal Fund meant increased
revenue for townshipswith the greatest needs and the transfer of revenue generated
by certaintaxes from national coffers to the municipalities. The resources obtainedthrough
the Fund were required to be spent on community services or localdevelopment
projects.
Furthermore,
in an effort to foster the participationof the private sector in municipal activities,
legislation was passed indicatingthat donations or contributions made by private
citizens or corporationsto development or social projects implemented by the
municipality were consideredlegitimate expenses for all legal purposes and could
be considered tax deductions.
3. SOCIAL
SERVICES AREA
As noted
earlier in this chapter, Chilean municipalitiesunderwent a set of significant,
innovative changes which extended into thebroadest reaches of their activities.
Nonetheless,
the area in which these changesare most evident is that of social services,
since it is here that the communitycan best perceive the specific improvements
or setbacks that these reformsimplied.
As with
all initiatives dealing with publicaffairs, the analysis of these changes must
be based on fundamental conceptsrather than partial or specific aspects of the
programs implemented.
It appears
that there is consensus that modernsocial policy should be based on social profitability,
focussing expenditureson the most needy, progressiveness, objectivity and efficiency.
The reformulation
of the social developmentstrategy implemented in Chile had as its key objective
the modernizationof social services at the local level. Municipalities, as the
governmentalagency closest to the people, played an important role in achieving
thisgoal.
Thus, the
initial objective of the modernizationstrategy sought to decentralize the operation
of social programs and servicesand provide local authorities with increasing
levels of influence.
We have
already seen how municipalities adjustedto their new role and the means they
used to confront their new responsibilities.It is time, therefore, to turn to
the ways in which decentralization ofmunicipal services in a variety of areas
actually took place.
a. Education
In the early
1980's, the administrative transferof educational establishments from the central
government to local municipalitiescommenced. This process was timidly begun
in a limited number of townshipsand was subsequently expanded, over a period
of approximately five years,to include all of the nation's communities.
The primary
objective of this transfer wasto bring the decision-making process closer to
the students, parents andteachers.
In its initial stages, the educational reformprocess transferred public elementary schools to municipal hands. In successivestages, secondary and technical-professional establishments followed thesame route.
Municipalities
were given the option of administeringthe educational establishments through
one of two mechanisms: creating privatecorporations directed by a board presided
over by the Mayor and composedof representatives of the community. The board
was then responsible forappointing a manager charged with administering the
corporation and itspersonnel; the second option was to administer the schools
through MunicipalDepartments of Education. This alternative granted administrators
less autonomythan the first option.
In any case,
both alternatives meant that employeeswould have to adhere to private sector
norms (except for teachers for whoma different set of regulations was in effect).
The transition
from the old system, in whicheducational establishments depended on centralized
public administration,and the new one, whereby schools depended on municipalities,
was not easy.Difficulties arose primarily as a result of a profound administrative
rationalization,which meant the dismissal of excess personnel employed under
the old system.
At present,
Chilean municipalities administeralmost all public educational facilities aimed
at the first two levels ofschooling. An important aspect of the new system is
that is applies exactlythe same financing mechanisms for the public sector as
are in operationin the private educational field. In fact, the State provides
a per pupilsubsidy to all such establishments.
During the
first years the system of municipaladministration of educational establishments
was in operation, the majorityof municipalities accumulated large budgetary
deficits. These deficits canbe explained by the presence of excess personnel
when the municipalitiestook control as well as other causes produced by poor
management. Furthermore,modifications in the system used for calculating the
re-adjustability ofthe educational subsidy provided by the State also helped
to generate thesedeficits.
Despite
these and other difficulties peculiarto large-scale transition processes, the
transfer of the administrationof educational facilities to the local level has
been highly successful.Achievements include increased participation by parents,
concern among localauthorities over the services provided, improvements in physical
infrastructurein elementary and secondary schools and community participation
in determiningthe future of local education.
b. Health
Care
Important
progress was also made in the areaof health care. The reasons for transferring
the administration of doctors'offices and small hospitals to municipal were
threefold:
- To reinforce the administrative decentralizationprocess;
- To expand coverage of primary care; and
- To adjust
primary health care services tothe needs of each community.
The Ministry
of Health was also restructuredin order to create a technical superintendency
charged with overseeing themunicipalized establishments. Thus, 27 Health Services
were created aroundthe nation. Each Service was granted relative autonomy to
implement thetechnical evaluation responsibilities retained by the Ministry
of Health.
At the national
level, the process for suchtransfers commenced during the second half of 1981
through the followingmechanisms:
- An agreement
was signed between each municipalityand the respective Health Service. These
agreements were formalized by SupremeDecree. The agreements were to last for
five years and could be automaticallyrenewed for subsequent periods.
- The Ministry
of Heath, in the majority ofcases, remained the proprietor of health-related
properties and loaned themto the municipalities.
- Municipalities
were obligated to identifythe legal or conventional services beneficiaries would
receive and provideambulatory and non-ambulatory care. As a result municipalities
were alsoobligated to engage in activities aimed at fostering and protecting
healthand well-being among the populace as well as providing simple recovery
services.More complex cases were referred to the corresponding Health Service.
- In terms
of programs, the agreements indicatedthat the following services were to be
provided free of charge:
- Infant and adolescent care
- Adult and senescent services
- Obstetric, gynecological and pre-natal care
- Orthodonture program. This was the only exceptionto the complimentary benefit rule as municipalities were authorized to chargefees for this service.
- Healthy
home program.
In addition
to these programs, individual agreementsidentified supplementary programs that
health care establishments were requiredto continue to provide such as house
calls, group education, vaccinations,nutritional programs, etc.
- The labor
laws covering personnel employedat municipalized health care centers (as with
education), were modifiedso that they were subject to the same norms as private
workers.
- Municipal
resources available for the administrationof these facilities could originate
from three sources. Payments by therespective Health Service, which were made
available within the first 10days of the month following the date the service
was provided. A secondsource of financing was the resources the municipality
itself chose to investin health care. Lastly, resources were also available
through the NationalFund for Regional Development which focused on improvements
to physicalinfrastructure and equipment.
- Other
social programs. In addition to themodifications introduced in the fields described
above, changes were alsoimplemented in a variety of areas related to social
development. In eachcase, an effort was made to show that the application of
efficient rulesand good administration could and must be accepted and practiced
by thepublic sector.
For example,
in the area of care for minors,centers administered by the private sector were
established and a systemof pre-school care was implemented which consisted of
having mothers whofulfilled certain prerequisites take over the part-time care
of childrenfrom less stable homes in exchange for a salary.
This was
also true in the area of subsidies,where private poll-takers provided services
aimed at identifying beneficiariesthrough questionnaires.
Furthermore,
a considerable number of privateentities work with the State and Municipalities
in implementing social developmentactions.
Even the
poorest communities have instituteda system of shared or proportional contributions
in order to engage privatefirms in local development projects.
Thus, the
large-scale structural transformationof Chile's social sectors was followed
by additional, simpler initiatives.These efforts bear testimony that the concept
of maximizing available resourcesthrough simple, creative solutions has been
assimilated as a key elementin Chilean social policy.
