Inter-Municipal Cooperation in Europe

INTER-MUNICIPAL COOPERATION IN EUROPE

INTER-MUNICIPAL COOPERATION IN EUROPE

Edited by

RUDIE HULST and ANDRE´

VAN

Vrije Universiteit Amsterdam, The Netherlands

MONTFORT

A C.I.P. Catalogue record for this book is available from the Library of Congress.

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Table of Contents Preface ...................................................................................................................... vii About the Authors ..................................................................................................... ix 1.

Inter-Municipal Cooperation: A Widespread Phenomenon .............................. 1 Rudie Hulst & André van Montfort

2.

Belgium: Flemish Inter-Municipal Cooperation under Reform ...................... 23 Bart De Peuter & Ellen Wayenberg

3.

Inter-Municipal Cooperation in Finland: Old Traditions and New Promises ........................................................................................... 39 Arto Haveri & Jenni Airaksinen

4.

Inter-Municipal Cooperation in France: Incentives, Instrumentality and Empty Shells............................................................................................. 67 Karen West

5.

Inter-Municipal Cooperation in Germany: The Mismatch Between Existing Necessities and Suboptimal Solutions............................................... 91 Werner Heinz

6.

Italy: The Changing Boundaries of Inter-Municipal Cooperation................. 117 Marcello Fedele & Giulio Moini

7.

The Netherlands: Cooperation as the only Viable Strategy........................... 139 Rudie Hulst & André van Monfort

8.

Inter-Municipal Cooperation in Spain: Dealing with Microscopic Local Government ......................................................................................... 169 Eva Nieto Garrido

9.

The Missing Ingredient: Inter-municipal Cooperation and Central-Local Relations in the UK ....................................................................................... 193 Josephine Kelly

10.

Comparative Analysis and Conclusions ........................................................ 211 Rudie Hulst & André van Montfort

Preface Municipalities are considered the oldest and most enduring elements in European administration. Over the past fifty years, however, they have been confronted with a series of developments that have strained the limits of their performance, altered their domains and even threatened their existence. Smaller communities are finding it increasingly difficult to meet the demands and standards of local government in relation to providing public services that require a larger scale of production. Furthermore, all local communities are confronted with the increasing scale and complexity of social processes, which result in an increasing number of externalities of local policies. And last, European integration challenges the structure of local governments with its own tasks and opportunities. One of the strategies to cope with these issues is inter-municipal cooperation. The joint provision of public services is a way to overcome the production-related obstacles and meet the rising expectations of citizens. Joint planning and policy coordination make it possible to incorporate mutual interdependencies between neighbouring municipalities and thus enhance the quality and efficacy of local policies. Intermunicipal cooperation is now a widespread phenomenon throughout Europe. Despite its ubiquity, inter-municipal cooperation has not been subject to systematic comparative research. There are no methodologically ordered data on the variations in density of inter-municipal cooperation for individual countries or policy sectors. There is also very little information available about the institutional arrangements in use. Furthermore, although there are strong indications that inter-municipal cooperation is not always successful, what determines success or failure is to a large extent unknown. Against this background, we have engineered a project for comparative research in association with colleagues from various European countries. This book is the result of that joint project. It presents an overview of the presence and functioning of inter-municipal cooperation in eight European countries. Each country study sketches the different forms of inter-municipal cooperation present, their institutional designs, the tasks and competencies attributed to joint authorities and the way inter-municipal cooperation operates in practice. Both the performance and democratic aspects of cooperation are recurring topics. The last chapter of the book presents a comparative analysis that establishes and explains both differences and similarities in the countries studied. It also reflects on the significance and future of inter-municipal cooperation and suggests topics for future research. We thank our colleagues from other European countries who contributed to this volume. All of them have kept their promise to deliver a systematic and comprehensive country study. We are also indebted to our publisher Evelien Bakker. She offered us the opportunity to present the research findings in an attractive way to practitioners and scholars of public administration and was supportive during the production process. Finally, we thank our American translator Susan MacDonald. Her meticulous and energetic method of working has ensured that this book has been written in authentic European English. Rudie Hulst & André van Montfort Amsterdam, June 2006

About the Authors

JENNI AIRAKSINEN (1975) is a researcher at the Department of Regional Studies, University of Tampere, Finland. Her research interests focus especially on public management reforms, local government management and inter-municipal cooperation. MARCELLO FEDELE (1947) is a professor of Political Sociology and Local Government at University “La Sapienza”, Rome, and director of the Department of Social Innovation. He also directs the Master Course in the Management of Local Governance. He has been involved in various EU research programmes, particularly in the immigration policy sector. Recent publications concern the institutional basis for local welfare policies and intergovernmental cooperation. ARTO HAVERI (1963) is a professor of Local Government Studies at the Department of Regional Studies, University of Tampere, Finland. His research focuses primarily on local governance, public sector reforms and, most recently, on problems of facilitating better inter-organisational collaboration in service delivery and local economic development. WERNER HEINZ (1944) studied civil engineering, architecture, urban planning and sociology at the Technical University, Darmstadt, Germany. He obtained a diploma in urban planning and architecture and a doctorate in Sociology. Since 1978 he has been a senior researcher at the German Institute of Urban Affairs (Central Research Institute and Advice Center of German cities, located in Berlin and Cologne). He has published and lectured extensively on national and international forums on the development and management of cities and regions. RUDIE HULST (1953) studied Political Science and Public Administration at the Vrije Universiteit, Amsterdam, the Netherlands. There he also obtained a doctorate with a thesis on regional governance. At present, he teaches Public Administration at the Vrije Universiteit. His main research topic concerns intergovernmental relations. He has published on the effects of decentralisation and on intermunicipal cooperation. JOSEPHINE KELLY (1958) is a lecturer at the Aston Business School, Birmingham (Policy Studies and Service Management Group). Her research interests include local government, the management of central-local relations and state regulation of sub-national government. Recent publications concern the activities of the Audit Commission and the modernisation of British local government.

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GIULIO MOINI (1963) is a fellow at the Sociology Faculty at University “La Sapienza”, Rome, where he teaches Public Policy Analysis. He coordinates various research projects for the Department of Social Innovation financed by the Ministry of Welfare (evaluation systems for social inclusion policies) and the European Union (local strategies to foster social cohesion in a changing labour market). Recent publications concern intergovernmental cooperation and local and regional health policies. ANDRÉ VAN MONTFORT (1959) studied Public Administration (University of Twente) and Law (Erasmus University Rotterdam) and wrote a doctoral thesis in the field of Sociology of Law. He is an associate professor in Public Administration at the Vrije Universiteit Amsterdam, the Netherlands. His research focuses on intergovernmental relations and integrity of governance . EVA NIETO GARRIDO (1968) studied law at the Complutense University, Madrid. She obtained her doctorate with a thesis on administrative consortia. Since 2005 she has combined a clerkship at the Spanish Constitutional Court with a teaching position at the University of Castilla-La Mancha. Her areas of expertise are administrative organisation and agencies, environmental law, European administrative law, and fundamental rights. BART DE PEUTER (1977) is a researcher at the Public Management Institute at the Faculty of Social Sciences of the Catholic University of Leuven, Belgium. He has a licentiate in Political and Social Sciences and possesses the European Master of Public Administration degree. His main research topics are local government, intergovernmental relations and monitoring, and policy evaluation. ELLEN WAYENBERG (1976) is a researcher at the Public Management Institute at the Faculty of Social Sciences of the Catholic University of Leuven, Belgium. She obtained a doctorate with a thesis entitled Changes in Flemish Central-Local Relations: Towards Partnership? Her main research interests concern intergovernmental relations, local government and urban policy. KAREN WEST (1963) is a lecturer at the Aston Business School, Birmingham (Policy Studies and Service Management Group). Her research activities include comparative public administration, management and governance, with a special interest in the UK and France. Her current research focuses on the regulation of contractual relationships in public services, particularly on developing a better understanding of the relationship between accountability and relationality.

CHAPTER 1 RUDIE HULST & ANDRÉ VAN MONTFORT

INTER-MUNICIPAL COOPERATION: A WIDESPREAD PHENOMENON

1.

The Position of Local Government

Local government is generally considered the oldest and most enduring element in European administration, its roots going as far back as the thirteenth century (Bennett 1993: 31). In most Western European countries, local authorities came to be constitutionally recognised in the nineteenth century. This was the case with Switzerland (1803), France and Belgium (1831), Denmark and Norway (1837), the Netherlands (1848), Sweden (1862) and Finland (1865). In other countries, like Italy (1948), Germany (1949), Portugal (1976) and Spain (1978), local government only obtained a constitutional status after periods of war and dictatorship (Norton 1994: 9-12). All of Western Europe subscribes to the principle of self-government for local communities (although not all countries protect it by constitution), and local governments fulfil an important role in the delivery of public services in the (post-) welfare state (Goldsmith 1992: 393-394). In many respects, however, the picture of local government is multi-coloured, and the differences more than the similarities catch the eye. Without pretending to sketch a complete picture of the varieties of local government in Europe, some of the more noticeable differences relate to scale (the number of inhabitants), the position of the local authority as a second, third or fourth tier in the administrative system, its character and scope (the functions it performs in the whole of the state administration, including the amount of local government expenditure in relation to total public expenditure), and the degree of autonomy and discretion it enjoys in exercising its functions. On the scale of local government, variations are substantial. The average population of the French commune does not exceed 1,600, while more than 75 percent of the 36,700 communities have less than 1,000 inhabitants. On the other end of the spectrum we find the large-scale local authorities of the United Kingdom – unitary authorities, 1 districts and boroughs – with an average population of around 130,000. In Sweden, R. Hulst and A. van Montfort (eds.), Inter-Municipal Cooperation in Europe, 1–21. © 2007 Springer.

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the Kommuner represent one of the two tiers of general government. The Spanish municipios find themselves in the company of at least three upper tiers of government: central government, the autonomous regional governments and the provinces. It is possible to differentiate, in theory at least, between local government as a communitybased body that represents the idea of a high level of political participation, and local government as an agent for the delivery of public services close to their consumers (Bennett 1993: 5). On this dimension, the local authorities in southern Europe (France, Italy and Spain) stand out as community-based, while the municipalities in the Nordic countries (Norway, Denmark and Sweden) represent the service delivery type. As a corollary, the volume of local expenditure in the southern countries does not exceed 15 percent of total public expenditure; in the Nordic countries local expenditure is more 2 than 40 percent of the total. Making any general statement about the degree of autonomy of local government in the different countries of Europe is nearly impossible. The establishment of local autonomy admits different approaches and no simple universal indicators are available to measure the degree of decentralisation of an administrative system (Fleurke & Willemse 2004).3 Most local authorities in Europe enjoy constitutionally protected autonomy, but both the constitutional provisions and formal intergovernmental relations vary substantially. There are differences within the countries themselves, sometimes because the legislation relating to local government differentiates between categories of municipalities (as is the case in Spain), and sometimes because the organisation of local government is not the responsibility of central but of regional government (as is the case in Germany). Moreover, an analysis of the formal position of local government only reveals part of its actual autonomy and policy discretion. The mere constitutional provision that the French commune has a general competence had little significance so long as local government decisions were subject to administrative supervision; a large number of issues of the welfare state were a subject of central policies and regulations and the rules that came along with specific grants to be spent by local government severely limited the financial autonomy of the municipalities (Maurel 1993: 145). Although the decentralisation reforms that have taken place since 1982 have evidently strengthened their formal position – increasing local competencies in the field of town planning and education, amongst others – many communes are not really able to exercise their autonomy due to a lack of administrative and financial capacity (Preteceille 1988: 416, Maurel 1993: 148). With respect to Dutch municipalities, scholars of public administration have sung a nearly unanimous song that the centralisation of the administrative system (especially between 1960 and 1980) hollowed out local autonomy and turned municipalities into instruments of central government. Research shows, however, that local autonomy – the capacity of municipalities to take initiatives and carry out integrated policies in response to the necessities of the local community – is actually substantial and that genuine local issues dominate the agendas of the local executives and councils (Willemse 2001: 209-232). The dimension of local autonomy makes hazardous, if not impossible, the development of a typology of local government along the lines of the different European nation states. We will refrain from it, as inter-municipal cooperation and not local government itself is the primary subject of this volume. When studying cooperation

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between municipalities, however, the variation both in the institutional context and in the policy making capacity of local government must be taken into account. 2. Local Government Under Pressure Irrespective of scale, scope, autonomy and position in the national administrative system, a series of developments over the past fifty years have put pressure on local governments’ performance, domain and even existence. The first development concerns the increasing scale of production of public services to meet the steadily rising standards put by the public. Especially since the 1960s, the smaller local authorities experienced their own territorial scale as no longer compatible with the requirements for technological and economic efficiency in public service delivery. Small communities were not able to maintain a fire brigade with up-to-date apparatus and full time professionals. Similarly it proved impossible for them to maintain a decent public library, a heated swimming pool, a fully equipped public health service or a modern waste management system. While the scale of production was rising, many European rural communities faced a decreasing population due to urbanisation and emigration. Between 1960 and 1975, around half a million Spaniards left rural communities annually to settle in urban areas like Madrid, Barcelona, Valencia and the cities of the Basque country. In the same period, about 2 million people left Spain to find employment in the industrialised countries of Northern Europe. In France, between the late 1950s and the early 1970s, comparable internal migration movements were only tempered by the economic crisis of the mid 1970s, improvements in the rural economy and social problems in the large cities, amongst other factors (Champion 1992, Ogden & Hall 2000). In these countries, an overall increase in the population went hand in hand with a stagnation or decline of the population of the smaller communities, exacerbating the problem of procuring an adequate level of public service provision. Another development concerned the increasing physical mobility of the population and the fragmentation of its social participation (Webber 1964). In the first half of the twentieth century, the local community was the place where most people were born, schooled, employed, married and eventually buried; by the end of the 1960s this picture had radically changed. The social processes relevant for local policies were no longer restricted to the territory of local government (Wannop 1995: 375). In general, administrative structures at the local level became under-bounded, i.e., they got smaller than the activity space of their inhabitants (Bennett 1993: 7-8). As a consequence, there was a sharp increase in the externalities of local policy making. Local decisions to invest in business parks, public housing, secondary education, health facilities and infrastructure have an impact beyond the territorial boundaries of the community. At the same time, municipalities frequently have to deal with the consequences of their neighbours’ decision making. The strong interdependencies between large-scale social processes in an ever more complex society and between corresponding interventions of local government require policy making on a scale that exceeds the territorial scale of even the larger communities.

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A third and more recent development concerns the increase in market pressures on local government (Marcou 1993: 63-64). They result from two parallel developments: a redefinition of the relationship between state and market, and European integration. Although causes and goals may be debatable, since the beginning of the 1980s most European countries have clearly experienced a transformation of the role of the state in relation to society. Privatisation and deregulation have increased the role of the market in service delivery and diminished government intervention. The market, on the other hand, has increasingly interfered with public administration. Government agencies are viewed as business-like institutions that must meet the demands of their customers, compete with each other for resources and be judged on their performance, preferably expressed in quantifiable goals (Bennett 1990, Hughes 2003: 8-15). The introduction of a single European market and the expansion of Europe’s policy domain have opened a new set of threats, constraints and opportunities for local and regional government in the countries of the European Union. The single market has removed the protection regional and local economies enjoyed from national legislation and boundaries (Bennett 1993:17-18). City regions have to compete with their counterparts in other countries of the European Union, requiring adroit govern4 ance at the local and regional level. A steady flow of European regulations and directives force sub-national governments to follow new procedures (competitive tendering, environmental impact assessments) and to meet new standards in a number of policy areas that require substantial expertise and problem solving capacity. The financial resources Europe offers create opportunities for local and regional government, but they also pose new challenges. To meet the partnership principle embedded in the decision making and management procedures of the European Structural Funds, new institutions are required. Therefore public administration scholars see a direct link between the introduction of the partnership principle and the rise of (new forms of) regional governance and government (Sharpe 1993, Marcou 1993: 55, Loughlin & Peters 1997: 41-42, Lahj 2004, McCallion 2004). 3. Strategies to Cope with the Pressures Roughly speaking, nation states have used four strategies to deal with the pressures on local government resulting from the increasing technical scale of production, the growing scale of social and economic processes and the pressures of the (European) market. The first involves territorial reform: the amalgamation of municipalities into bigger administrative units of local government. Territorial reforms of local government can be found in almost every European country. There are, however, notable differences in the scale of the reforms and in the way they have come about. On one hand, a series of countries in Northern Europe engaged in large-scale amalgamation projects that in one fell swoop created municipalities of considerable size. This was the case with the United Kingdom, where a major territorial reform in 1972 created units of local government with an average population of about 130,000 (Norton 1994: 362-365, Wollmann 2004: 644). In Sweden, a similar project carried

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out in 1974 resulted in local government units with an average of 31,000 inhabitants; in (Western) Germany the Länder in the 1960s and 1970s engaged in a series of territorial reforms to create municipalities with an average population of nearly 10,000 (Keating 1995). On the other hand, we see countries (especially in Southern Europe) that did not undertake any large-scale territorial reforms and where occasional projects to upsize the scale of local government have met with strong resistance, yielding little to no results (Norton 1994: 38). In France, despite the very small scale of the major part of its local government, efforts to promote amalgamation through special laws in 1959 and 1971 have only succeeded in reducing the number of communes from about 38,500 in 1800 to 36,500 at present (Maurel 1993: 150, Loughlin & Seiler 2001:194). In Spain, the number of municipalities has been stable over many years, and has even slightly risen in the last two decades due to the segregation of new urbanisations from their original municipalities. Despite the fact that nearly 5000 of Spain’s 8,100 municipios have a population of less than 1000, recent proposals for the territorial reform of local government developed in some of the autonomous regions were not well received. Several autonomous regions did, however, adopt legislation to prevent further fragmentation of local government (Burgueño Rivero 2001: 201-202). Italy shows a similar picture with a relatively large number of small municipalities and piecemeal, if any, adaptation of the scale of local government. The second strategy to deal with the different pressures discussed above has been to somehow limit the operational scope and autonomy of local government, i.e., to redistribute the responsibilities between the different levels of government. In France, the départements have gradually taken over some of the functions beyond the resources of the communes; in the 1990s, Dutch regional police forces under the supervision of the Ministry of the Interior replaced the long lasting local police forces, and responsibilities for environmental policies were partly transferred to the provinces (Norton 1994: 143-144, Hulst 2000: 5). A somewhat different arrangement was created in Spain with the new regime for local government in 1985, which introduced a legal obligation for the provinces to assist the municipios on economic, technical and legal issues, without, however, providing the necessary resources or competencies (Carballeira Rivera 1991). Although the transfer of responsibilities for the provision of public services to upper level government did sometimes occur, the strategy seems to have been relatively unpopular. On the other hand, the attribution of administrative powers or resources to upper level government related to the planning and coordination of local policies has been much more frequent. The rise of meso government, as described by Sharpe and colleagues (1993), has been above all the strengthening of intermediate levels of government through the attribution of competencies for planning and coordination, sometimes a result of decentralisation (France, Italy and Spain in the 1980s and 1990s), sometimes a deliberate centralisation of the relations between local and regional government (the Netherlands in the 1970s). This is not the place to evaluate the adequacy of upper level government as an alternative for service delivery by (small-scale) municipalities, or if it has been successful in the coordination of local policies. This much, however, is clear: all that glitters is not

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gold, especially in the issue of coordination. The French regions and the Dutch provinces are considered relatively weak entities when it comes to planning local government policies because of a lack of administrative powers and legitimacy (Le Galés & John 1997: 55-57, Jouve 1997: 367, Hulst 2000: 106-116). The third strategy in use is the involvement of large privately and publicly owned companies and organisations in the fulfilment of public tasks. The establishment of independent public companies and the outsourcing of service delivery to private companies and foundations have been extensively used in several European countries throughout modern history. As mentioned, in a number of European countries, the amalgamation of local government has proved difficult if not impossible. This was, however, not the case with the companies and foundations involved in the delivery of public services. Locally founded public enterprises providing utilities like water, electricity and gas have merged over time to service a growing number of local communities. Local private foundations involved in the provision of health services, social services and public housing have developed into large-scale organisations servicing entire regions. And with respect to the outsourcing of public service delivery to private companies, local governments have been able to profit from the growing competition in national and international markets, enabling them to get more value for their money. Historically, there have been evident differences in the mix of public, corporate, and market production of public services in the different countries. Since the 1980s, however, inspired by neo-liberal ideologies and the New Public Management movement, private production of public services has spread throughout Europe (OECD 1991, OECD 2002). Although this strategy helps local government cope with the growing technical scale of production and growing social pressures to provide quality services at low costs, it is not without problems. The most pressing is the organisation of control and accountability to safeguard the public interest (Hughes 2003: 107 et passim, OECD 2002). Moreover, European regulations limit government agencies’ dealings with the private sector, imposing competitive tendering and precluding market interference. Lastly, the strategy of involving the private sector is limited to delivery of services; it does not extend to the coordination and planning of local policies. Due to its political nature, planning and coordination decisions will always remain the responsibility of elected public authorities, and cannot be outsourced to public or private agents. The fourth strategy in use to deal with the rising scales of production and mobility and with growing market pressures is inter-municipal cooperation. Here, we include cooperative arrangements between municipalities, between (groups of) municipalities and authorities and agencies at other levels of government, and between municipalities and private sector organisations. Cooperation is the central theme of this volume and below we will elaborate on some basic concepts and an analytical framework for the study of this phenomenon. Here we confine ourselves to some introductory remarks. While the three strategies discussed thus far imply either the establishment of new and better-equipped authorities or the transfer of tasks to other authorities or private organisations with adequate scale and capacity, cooperation leaves the fulfilment of public tasks entirely in the hands of the

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municipalities or their immediate representatives. The joint operation of public service delivery must yield the necessary economies of scale and the mutual adjustment of local policies must result in a coordinated approach of issues that surpasses municipal boundaries. In some European countries inter-municipal cooperation is a phenomenon (nearly) as old as the municipality itself. In France, the first councils established by local government to administer communal services date from the end of the nineteenth century (Maurel 1993: 150); in the Netherlands, the 1851 Municipal Act already contained a provision for cooperation between municipalities “in communal affairs, interests, installations and works”, although the supervising authorities gave a rather strict interpretation to the legal provision and held municipalities short during many years (Hulst 2000: 7-8). Cooperation involving municipalities has boomed since the 1950s in a wide variety of forms and shapes: from single purpose to multipurpose; from mutual consultation to joint operation of inter-municipal agencies, involving small and large numbers of municipalities and including different territorial scales, sometimes involving private sector organisations and upper level government. Sometimes cooperation is a statutory obligation and the law regulates the tasks and competencies; mostly it is left to the municipalities to set up cooperative bodies and decide on their scope and administrative powers and resources. There are different arrangements and practices with respect to the governance of joint institutions and their accountability to the democratically elected local councils. What all these forms have in common is that they are set up to cope with the issues of scale and rising pressures without giving up local control over the policies and tasks involved. The different strategies discussed here can be considered functionally equivalent. Therefore, one expects that the presence of one would render the others less relevant, or that the inability to implement one strategy would force administrations to resort to others. If the national political culture allows for radical reforms of the administrative system, and countries opt for a territorial reform of local government that results in large-scale municipalities, the need to entrust intermediate levels of government with the planning and coordination of tasks evidently diminishes. Therefore, UK scholars in the past have argued that there was no need to create regional government in England, as the large-scale boroughs and counties could perfectly cope with the increased functional scale of public service delivery, population mobility and service externalities (Jones 1988, Sharpe 1993: 274). In the Netherlands, there was never any enthusiasm for large-scale amalgamations of local government. Moreover, it proved nearly impossible to create new intermediate levels of government to substitute public service delivery by local government, despite a series of serious efforts over time. Every time proposals for new intermediate levels of government ended in the waste basket, central government immediately created new incentives and new legal forms for inter-municipal cooperation (Hulst 2000: 4-19). Nevertheless, while the different strategies can be considered communicating vessels, they are not mutually exclusive. In France, regional governments for the planning and coordination of social and economic policies (established in 1982) and départements that have traditionally provided public services to the communes

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coexist with a large number and variety of inter-municipal corporations. This coexistence does, however, result in the organisational fragmentation of regional planning (Hulst 2005: 109). In England, Regional Planning Bodies or Assemblies set up to organise cooperation between local governments and other regional stakeholders coexist with large-scale local government. In the Netherlands, municipalities have outsourced some public services to private companies – in about half of the municipalities refuse collection is contracted out to large companies operating on a national scale – while other services are in the hands of public agencies run by the joint municipalities, which is the case of most of the regional public libraries. Although in the past some competencies of Dutch local government regarding spatial planning have been transferred to the provinces to safeguard regional coordination of local policies, others have remained at the local level and are a subject of intermunicipal consultation and coordination. All in all, inter-governmental cooperation involving municipalities is a phenomenon that can be found in all Western European countries. In some it has a long history, in others it is relatively recent; it varies in presence, weight and form, but is never completely absent. Nevertheless, it is a type of administration that, so far, has not been the subject of extensive comparative research. When it comes to the study of sub-national government, most attention goes to local government and local governance. Inter-municipal cooperation as such receives much less attention and comparative research is rare.5 Moreover, much of the existing literature focuses on the special case of governance in metropolitan areas (cf. Lefevre 1998, Herschell & Newman 2002, Nunes Silva & Barlow 2002). 4. Cooperation: Aspiring to the Best of Two Worlds Norton (1994: 48-49) mentions that in several European countries inter-municipal cooperation has been the result of persuasion, incentives and legal requirements. Legal forms have been designed to facilitate the transfer of responsibilities to a joint body; financial incentives have been created to induce local government to cooperate. One may wonder why central governments throughout Europe see intermunicipal cooperation as worthwhile. The main reason seems to be that inter-municipal cooperation seeks to combine two of the values deeply embedded in the government systems of many European countries: local self-government and rational governance. Inter-municipal cooperation on one hand creates some form of institutionalised governance to address the issues of scale and rising market pressures on local government. It aspires to provide for public service delivery that meets the rising demands of the citizens of the local communities at the lowest costs possible; it seeks to regulate the externalities of local policies to prevent the waste of public resources and to strengthen the capacity of the joint municipalities to cope with the opportunities and threats of an increasingly complex and dynamic environment. On the other hand, inter-municipal cooperation leaves the policy domain of local government intact. Irrespective of the form it takes, there is no permanent transfer or loss of local tasks or competencies, and somehow

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local governments keep control over the decisions and services that result from cooperation. As a consequence, inter-municipal cooperation prevents – in theory at least – local democracy, valued for the small distance between the electorate and the administration, from being hollowed out as a result of the pressures on local government. Inter-municipal cooperation has one other clear advantage over some of the alternative strategies discussed above. Both territorial reorganisations and the centralisation of local tasks to upper level government imply more or less radical changes in the administrative organisation of the state, usually requiring formal legislation. Although the administrative systems in some countries are more adaptive than others, inertia (with good reason) is always present. The costs of decision making to reorganise the system, setting up new administrative organisations, building up new capacities and routines for policy-making – not to speak of what is lost in the reorganisation – precludes changing the scale of local government every ten years or so. Inter-municipal cooperation, on the other hand, is much easier to adapt to new circumstances and developments. If the scale for efficient production rises, it is relatively easy to involve a larger number of municipalities in the cooperative arrangement, or to extend cooperation to other public and private partners; if new policy areas require coordination, the costs to add new items to the agendas of existing consultative bodies are relatively low. Although inter-municipal cooperation is not a new form of governance, and even has a long tradition in many countries, it may well prove more capable of dealing with today’s rapidly changing environment than other traditional forms of government. There is of course the other side of the coin. In the first place, the assumption that inter-municipal cooperation results in efficient and modern public service delivery that adequately copes with the social, economic and spatial issues at hand deserves critical examination. While effective and efficient performance is not self evident for a standing government agency, the fact that cooperation is the central coordinating mechanism for decision making and service delivery entails serious complications. On theoretical grounds one would expect decision-making costs for coordination and service delivery to be higher than in a standing organisation, because it involves more decision makers and lacks hierarchical provisions to get out of deadlock situations. The latter may also affect the quality of both decisions and services, for compromise will sometimes gain the upper hand over best technical or political value. In the second place, there is the question of democracy. While local self-government evidently profits from inter-municipal cooperation when compared to centralisation, it is not clear beforehand that the same goes for local democracy. The question is if and how joint decision making by the municipalities is subject to democratic control. Are the local councils informed about what goes on in consultations among municipalities? Is there some sort of representative body that actually controls the budgets of inter-municipal agencies involved in service delivery? Although in theory proper procedures and institutions can be arranged to safeguard the accountability of the executives involved, the fact that decision making takes place in interaction with other local government executives complicates the issue.

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5. Central Research Question and Basic Concepts There is no systematic insight into the practice of inter-municipal cooperation to decide if inter-municipal cooperation succeeds in realising the values of democratic local self-government and of rational governance, or if the performance of inter-municipal cooperation is related to the institutional forms in use and the context it functions in. There is evidence that cooperation in the special case of the metropolitan areas does not always result in adroit and effective governance (Lefevre 1998, Nunes Silva & Barlow 2002, Herschell & Newton 2002). It is not clear if this picture holds in general. We know even less about the performance of cooperative arrangements and institutions involved in the delivery of public services. This brings us to the central theme of this volume. It aims to make inventory of the existing trends in inter-municipal cooperation in a series of European countries and to systemise the knowledge and research findings on its performance. The central research question of the project is: What is the state-of-the-art in inter-municipal cooperation in European countries and what are its trends; how do different forms of inter-municipal cooperation perform in terms of efficacy, efficiency and democracy; and to what extent does the performance relate to the form of cooperation? In view of the variety of sub-national government bodies in Europe and of the tasks they perform, it is necessary to define some basic concepts to delimit the subject of our research and to provide tools for the description of inter-municipal cooperation. Two features are basic to the concept of inter-municipal cooperation. The first is that the interactions between local governments concern a common task or goal and enjoy some degree of institutionalisation. In day to day governance, local government frequently interacts with other municipalities, public authorities and private organisations to inform or be informed, to influence decision making, or to just be neighbourly. From time to time, municipalities will undertake joint action to lobby with upper levels of government for money or other resources, or for decisions that favour local policies. Although in all these situations some form of cooperation occurs, our research will be limited to cooperation that shows more or less stable patterns over time and concerns certain standing issues, tasks or policies. The second feature concerns the relation between the institutions of cooperation and the constituting municipalities. We will reserve the concept of intermunicipal cooperation for entities that formally depend on local government or other participating authorities for their establishment and existence. Therefore, we exclude sub- national authorities that have a statutory independence and mandate, even if local government is involved in the governing bodies. For example, the 1978 Spanish Constitution reaffirms the existence of the provincias and the organic law on local government assigns them a series of tasks and competencies. Because of these features, we will not consider them a form of inter-municipal cooperation, even though the municipios elect the provincial councils and one of

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the tasks of the provincias lies in the assistance of local government. On the other hand, despite the fact that French law introduces the communautés urbaines and formulates a series of mandatory tasks, they must be considered a form of intermunicipal cooperation because the establishment of a particular communauté urbaine depends on the joint decision of the local governments to do so. Moreover, the communes can resign their membership or jointly decide to dissolve the communauté. Having laid down the basic features of cooperation involving municipalities, it is possible to distinguish different dimensions of cooperation. A first relates to the composition of joint authorities. Our primary interest concerns the way municipalities make use of cooperative arrangements with their neighbours to address the issues of scale and growing market pressures. In doing so, local governments can extend their cooperative arrangements to include other public authorities (upper level government, specialised government agencies) or private sector organisations (foundations and companies). Consequently, we can distinguish between cooperative arrangements that are purely inter-municipal and institutions with a mixed (public or public-private) character. A second dimension concerns the tasks involved in inter-municipal cooperation. We distinguish between operational tasks and coordination tasks (Brasz & Van Wijnbergen 1974: 7, Everink & Van Montfort 1994: 427, Van Montfort & Coolsma 1995, Hagelstein 1995: 94-95, Herweijer 1998: 151-152). The distinction relates to the different issues of scale and the pressures on local government sketched above. Operational tasks refer to the joint production of public services: municipalities strive to overcome the limitations or inefficiencies of small-scale local government. Consider, for example, the joint operation of a music school, a fire service department, waste processing units or public transport. The motives for cooperation may vary. In some cases, the size of the local population may simply be too small for local government to provide for the most basic public service. In other cases, cooperation enables municipalities to set up services of a higher technical standard and against lower costs compared to services provided by a single municipality. Sometimes central government creates financial incentives for cooperation, thus lowering the operational costs for local government. Coordination tasks refer to the regulation of externalities of local policies and to an allocation of resources and costs that is rational from a supra-local perspective. Consider the coordination of local spatial plans for new housing or business parks to avoid cutthroat competition between municipalities, or the mutual adjustment of local policies concerning investments in recreational and cultural facilities, infrastructure or economic development to increase the competitiveness of the region in the national or European market. Coordination tasks also include the joint activities of municipalities to influence other levels of the national or European administration. A last descriptive dimension concerns the range of tasks and activities included in the cooperative arrangement. We can distinguish between single purpose and multipurpose arrangements and authorities. A number of European countries have joint authorities in their own right that engage in social services, refuse collection or music education, and standing committees that coordinate local employment or

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housing policies. Conversely, we also find authorities or arrangements that integrate a number of tasks or activities, up to the point where joint authorities assume the form of a quasi-regional government responsible for a wide range of public services and planning activities, a form sometimes encountered in metropolitan areas. 6. A Framework for Analysis This volume sets out to make inventory of the phenomenon of inter-municipal cooperation in a series of European countries and explain its performance with respect to public service delivery and the coordination of local government policies. Its aim is to develop theoretical explanations through comparative analysis of the practices of different forms of inter-municipal cooperation. Our analysis makes use of the basic concepts of sociological institutionalism (cf. March & Olsen 1987, Powell & DiMaggio 1991, Hall & Taylor 1996, Scharpf 1997). Central to sociological institutionalism is the notion that institutions, i.e., systems of rules, norms, values, routines and conventions, structure the courses of actions of actors (Scharpf 1997: 38). Institutions influence behaviour in two ways. First, institutions demarcate the boundaries of social behaviour through the definition of roles, obligations, commandments and prohibitions. They define which course of behaviour is appropriate, permitted or forbidden in certain circumstances. Second, institutions give meaning to human action. They influence the perceptions, preferences and strategies of actors. Actors define and justify their interests in the light of value systems and the role that is assigned to them (Hendriks 1996: 38). Sociological institutionalism does not deny or ignore the goal-rational dimension of action, although in institutional analyses phenomena like power and interests do not always get the attention they deserve (Powell & DiMaggio 1991: 30). In the context of inter-municipal cooperation we assume public and private actors to be goal-oriented and rational, pursuing their interests and making use of their powers to achieve their goals. But at the same time, we assume that the existing institutions shape the actors’ preferences and the way actors define their interests, and that they also determine which resources they have at their disposal. Moreover, we assume that in pursuing their goals, actors follow the rules of the game, both formal and informal, as defined by and embedded in the existing institutions. Given the approach sketched above, a first step to the understanding of the working of cooperation involving municipalities is to gain insight into the main characteristics of the national administrative system and the position of local government in it. This includes the federal or unitary character of the state, the number of administrative levels, the distribution of responsibilities between the different tiers of government, the scope and autonomy of local government and the number and size of the municipalities. These characteristics to a great extent determine the point of departure for inter-municipal cooperation, as they shape the preferences and interests of local government and set the conditions that determine the necessity or possible advantages of cooperation. The national context for cooperation is not only

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made up by the formal state structure, it also includes norms, values, informal rules and traditions that influence intergovernmental relations and interactions. Different state traditions may bear on (the need for) existing forms of cooperation. In addition to the national institutional context, there is the European context to consider. Local government, and therefore inter-municipal cooperation, is increasingly confronted with policies, rules and regulations produced by the European Union. These can create new opportunities and new constraints, providing incentives for cooperation (to obtain European subsidies) or limiting the operating space of inter-municipal corporations (in the case of outsourcing). Second, it is necessary to take stock of the legal framework specific for cooperation. What are the formal rules to establish and shape cooperation? Does the legislation regulating cooperation permit the establishment of mixed institutions where other public authorities and private organisations work together with local government? Is it possible to transfer local decision-making powers to joint authorities and to endow joint authorities with the power to levy taxes? What are the legal provisions with respect to the governance and democratic control of joint authorities? The legal framework to a large part determines the possibilities for cooperation and can also help to explain the institutions of cooperation and the patterns of interaction that develop because they may encourage or discourage certain types of cooperation. A third point of interest is the way upper level government – regions or central government – approaches the issue of inter-municipal cooperation. As mentioned above, several European countries make use of persuasion, incentives and legal requirements to stimulate inter-municipal cooperation, while others resort to different strategies to strengthen the capacity of local government (Norton 1994: 48-49). The presence of incentive structures related to inter-municipal cooperation may not only explain differences and trends in the occurrence of inter-municipal cooperation, the features of the incentive structures can also have an impact on the characteristics of the joint authorities or cooperative arrangements present. Above we laid down the basic features of what we consider inter-municipal cooperation: a form of institutionalised interaction between municipalities (that may extend to other public or private actors) concerning a common task or goal that does not result in a completely independent agency or corporation. Our theoretical approach implies that the institutional context created by the national administrative system and the legislation that directly applies to inter-municipal cooperation are important factors in the explanation of the presence and characteristics of cooperative arrangements and joint authorities. A second central assumption is that the processes and outcome of cooperation between municipalities depend on the characteristics of the institutions for cooperation that are set up or develop over time. In other words, we assume a relation between the institutional features of cooperation and performance. One of the features we assume relevant is the degree of organisational integration. Cooperation can be institutionalised in the form of a standing organisation run by joint municipalities. This is the case when municipalities establish a regional corporation and transfer specific tasks and authority to such corporation. The

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decision-making power of the individual municipalities is taken over by a jointly controlled board or council that governs a staff of officials involved in policymaking or service delivery. The establishment of a standing organisation implies the concentration of decision-making power and the integration of activities formerly carried out by the separate municipalities into one organisation. At the outset, one would expect cooperation through standing organisations to yield better results than looser forms of cooperation. The establishment of regional plans coordinating local policies, and the fact that such plans are developed by a relatively independent organisation and decided on by boards or councils especially called into being for that purpose will probably have a positive impact on the process and outcome of decision making. In the same way, if cooperation concerns operational tasks, one would expect a standing regional corporation to produce higher quality public services at lower costs than the separate municipalities due to economies of scale. On the other hand, the fact that regional corporations are set up and run by the municipalities may also create unfavourable conditions. It can complicate decision making in the executive boards and councils; it can also result in a poorly equipped organisational staff because municipalities will tend to minimise their financial contribution to joint operations. We expect actual performance of a standing organisation to correlate with the specifics of decision-making procedures and the staffing of the regional corporation. Inter-municipal cooperation can also take place using more or less loosely coupled policy networks that serve as a means for mutual consultation, coordination and joint decision making, leaving the actual management of the relevant tasks or policies in the hands of local government. In a policy network, municipalities work together in specific policy fields; however, it does not extend to the transfer of the relevant authority or task to a regional corporation, and the municipalities therefore retain their power of decision (Hulst 2000: 23-26, Airaksinen & Haveri 2003: 8-11). Over the past decades, scholars of public administration and political science have dedicated ample attention to the concept of policy networks, using different theoretical approaches and models. Our analytical framework focuses on two aspects. First, in line with the general theoretical approach set out above, we consider policy networks as institutions, i.e., as sets of formal and social rules, norms and values that create the framework for interaction between the participants; rules that specify the boundaries and scope of the network, the position and authority of the members, and regulate decision making, amongst others (cf. Klijn 1996, Blom-Hansen 1997). Second, we assume that the performance of the network, and the processes and outcome of decision making, can be understood from the interaction between the participants pursuing their interests, taking into account the rules embedded in the institutional framework. The scarcity and distribution of resources and the way the goals and policies of the members relate to each other will determine whether the interdependencies between the participants are symbiotic or competitive, i.e., whether resource exchange and cooperation will occur (cf. Levine & White 1961, Godfroij 1981, Rhodes & Marsh 1992, Rhodes 1997). In general, one would expect loosely coupled policy networks to perform worse than standing organisations because the decision-making power is

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dispersed and an integrated staff is lacking. On the other hand, both the institutional characteristics of the network and the actual interdependencies between its participants may create favourable conditions. Rules enabling majority voting and past successes can have a positive impact on cooperation, and the scarcity of resources may leave the participants no other option than to operate as if one were a single actor. The standing organisation and the policy network represent two extremes of a continuum, leaving room for a wide variety of institutional arrangements and varying degrees of organisational integration. In our analysis of the practice of cooperation in various European countries, we will look for correlations between the different types and degrees of organisational integration and performance. A second feature of institutional cooperation relevant for the performance of joint authorities or policy networks is the organisation of political representation, i.e. the role and the position of the organs that directly or indirectly represent the electorate. There are two reasons to focus on this aspect of the institutional design of cooperation. First, we consider a proper democratic legitimisation of the decisionmaking processes that take place in the context of cooperative arrangements as a value per se. Due representation of the local constituencies and accountability of the executives involved in inter-municipal cooperation are requirements that follow from the principles of the democratic constitutional state. Second, there is evidence that the organisation of political representation may affect the performance of regional corporations and cooperative arrangements. Experiences in France and the Netherlands seem to indicate that if political representation is organised through existing local councils, or if the electoral system for regional councils is wrought in such a way that it brings representatives to promote local interests and neglect the regional perspective, it may seriously hamper decision making between the municipalities (Hulst 2005).6 A last element of the framework of analysis concerns the environment. Although institutions and actors are central to the framework, it is evident that a series of contextual factors have an impact on the national administrative systems, the institutions of cooperation, the processes of interaction between the local government partners, and the outcome. In section 2 above, we sketched a series of developments that have put pressure on local government and will continue to influence the need for cooperation and the form it takes: the rising scale of production, the increasing mobility of the population, increasing market pressures and European integration. Obviously, there are many more contextual factors that can explain trends in inter-municipal cooperation and the performance of the different forms of cooperation. It is clear, for example, that the rapid introduction of ICT in public administration may both increase the need for cooperation (to create sufficient production scale) and improve the quality of service delivery. Trends in the culture of public administration science and practice obviously influence the choice of strategies to cope with the rising pressures on local government. So a wide range of social, economic, demographic, cultural and technological developments must be taken into account. We can summarize the elements of the framework of analysis as follows:

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Figure 1: The Analytical Framework

Institutional context: • • Context

•

European context: rules and regulations National institutional context: state structure and state traditions Institutional context specific for cooperation: legislation and incentive structure

factors: social, economic, demographic, cultural and

Institutional design of cooperation: • The degree of organisational integration (standing organisations, policy networks) • The organisation of political representation

technological developments Performance with respect to service delivery and coordination: • Efficacy • Efficiency • Democracy

7.

The Selection of Cases

The present volume includes eight country studies of cooperation between local government authorities. As explained above, the theoretical framework for the understanding of the presence and performance of inter-municipal cooperation focuses on the institutional context and the institutional design of cooperative arrangements. To obtain as rich a picture as possible of inter-municipal cooperation and to create favourable conditions for theoretical generalisation, a selection criterion was variation in the national institutional context. We focus on two dimensions of the institutional context: the national administrative system (the formal structure of the state and the position of local government within it) and informal rules and traditions that guide intergovernmental relations and interactions.

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With respect to the first dimension, the formal structure of the state relates to the number of administrative tiers and the division of powers between the different levels of government (cf. Loughlin 2001: 14). The state structure determines, among other things, the presence of a regional government that may provide for regional planning and large-scale service delivery. Also, the unitary or federal character of the state structure may determine whether formal rules for cooperation vary or are the same for the whole national territory. We distinguish between (1) federal systems with strong and constitutionally-safeguarded positions for the states and municipalities on one hand, and limited central government on the other (Germany, Belgium); (2) quasifederal systems, where relatively autonomous states coexist with central government that not only performs a number of functions but also establishes the framework of law for lower tiers of government (Spain); (3) regionalised unitary states with an intermediate level of government of substantial weight, but with a strong presence of central government (France, Italy); and (4) decentralised unitary states with a weak or absent intermediate level and relatively strong local government (UK, Finland, the Netherlands). To include countries with varying positions of local government within the formal state structure, we looked at the scale and scope of municipal government. The average population of local government is taken as a rough indicator for its policymaking capacity; the expenditure of local government (as a percentage of total public expenditure) is taken as an indicator of the volume of the tasks that are the responsibility of local government. The combination of these two indicators may serve as a predictor of the need for inter-municipal cooperation. This need is likely to be higher when small local government entities have a broad domain, and lower when large local government entities have a small domain. One would expect the presence of inter-municipal cooperation to vary according to the need. The second dimension involves state traditions, i.e., sets of values and informal rules that constitute expectations about behaviour (cf. Loughlin & Peters 1997, Loughlin 2001). The basic assumption is that these sets of values and rules relating to the state, its political organisation and its public administration do not only affect the way public actors deal with the policy issues they are responsible for, but also influence the way they interact with other public actors and organise their cooperation. We focus on two features especially: basic features of the dominant policy style and the main characteristic of the relations between state and society. If a certain state tradition highly values the legal basis of public administration and policy making, one would expect that cooperation between municipalities will tend to take place through formal arrangements. An overall organic relationship between state and society will probably favour cooperation that includes both public and private actors. Following Loughlin (1994), we differentiate four state traditions: Table 1: State traditions State tradition Anglo-Saxon Germanic Napoleonic Scandinavian (Source: Loughlin 1994)

State-society relations Pluralistic Organic Antagonistic Organic

Basis of policy style Incrementalist Legal & corporatist Legal & technocratic Consensual

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Table 2 contains an overview of the countries included in the volume and their characteristics on the different dimensions. Table 2: Selected Countries and Their Characteristics Country

State Form

Belgium Finland

Federal Decentralised Unitary Regionalised Unitary Federal Regionalised Unitary Decentralised Unitary Quasi-federal Decentralised Unitary

France Germany Italy Netherlands Spain United Kingdom

State Tradition

Average number of inhabitants of municipalities (2004)

Napoleonic Scandinavian

Gemeente: 19,532 Kuntia: 12,120

Local government expenditure as a percentage of total expenditure (%) 13 447

Napoleonic

Commune: 1,600

98

Germanic Napoleonic

Gemeinde: 10,000 Comuni: 7,221

159 2010

Germanic

Gemeente: 33,000

2011

Napoleonic Anglo-Saxon

Municipio: 4,800 Districts/boroughs/un itary authorities: 130,000

912 2613

(Note: Data from Dexia 2002. They include the current expenditures for municipalities and provinces.)

8. Plan of the Book The plan of the book is quite simple. The primary aim is to produce an overview of the presence of different forms of inter-municipal cooperation and to gain understanding of the way it functions and copes with the issues that face local government. Each of the country studies will sketch the main characteristics of the national administrative system and the position of local government. Subsequently each will give an overview of the different forms of inter-municipal cooperation present, their institutional design, the tasks and competencies attributed to joint authorities of municipalities and the way inter-municipal cooperation operates in practice. Both performance and democratic aspects of cooperation will be recurring topics. The last chapter of the book contains a comparative analysis to establish and explain both differences and similarities between the countries studied. It also reflects on the significance and future of inter-municipal cooperation. References Aja, E. (2001). Spain: Nation, nationalities, and regions. In J. Loughlin (Ed.), Subnational democracy in the European Union. Oxford: Oxford University Press.

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Traag, J.M.E. (1993). Intergemeentelijke samenwerking. Democratie of verlengd lokaal bestuur. Enschede: Universiteit Twente. Powell, P.J., & Di Maggio, W.W. (Eds.). (1991). The new institutionalism in organizational analysis. Chicago: University of Chicago Press. Precedo Ledo, A. (2004). El modelo de desarrollo comarcal. Boletín de la Asociación de Geógrafos Españoles, 38, 29-45. Valles, J.M., & Cuchillo Foix, M. (1988). Decentralisation in Spain: A review. European Journal of Political Research, 16 (special issue), 395-407. Wannop, U. (1995). The regional imperative. Regional planning and governance in Britain, Europe and the United States. London: Kingsley. Webber, M.M. (1964). Urban plan and nonplace urban realm. In M.M. Webber, Exploration in Urban Structure (79-153). Philadelphia: University of Pennsylvania Press. Willemse, R. (2001). Het bestaansrecht van de Nederlands gemeente. Delft: Eburon. Wollmann, H. (2004). Local government reforms in Great Britain, Sweden, Germany and France. Local Government Studies, 30(4), 639-665. Wolman, H. (1988). Understanding recent trends in central-local relations: Centralisation in Great Britain and decentralisation in the United States. European Journal of Political Research, 16 (special issue), 425-435.

Notes 1 Data from the Institut National de la Statistique et des Etudes Economiques (1999 census) and www.lga.gov.uk. 2 Cf. Page and Goldsmith (1987: 157), Norton (1991: 23). 3 Popular as it has been to use financial indicators to assess the degree of decentralisation (cf. Sharpe 1988, Wolman 1988, Bullman 2001: 90, Hendriks 2001: 151), it is clear that local autonomy does not only depend on the volume of expenditure, but also on the policy discretion local authorities enjoy. Topdown indices of local autonomy have limited value (Brown 1992). 4 In 1989, a special advisory committee to the Dutch government propagated, in view of the introduction of the single European market, the establishment of new regional government structures in the Rotterdam and Amsterdam regions to strengthen the competitiveness of these centres of economic activity. 5 Exceptions are Norton (1994), who briefly discusses inter-municipal cooperation in his comparative analysis of local and regional government, and Heinz (2000), who treats different aspects of intermunicipal cooperation in France, the UK, Germany and the Netherlands. 6 Research by Traag (1993: 201 et passim) amongst members of executive boards of regional corporations (they combined this function with the membership of the executive board of their municipality) and members of the regional councils (representatives of the elected local councils) showed a significant difference in orientation: The regional executives were more inclined to develop a regional perspective on the issues at hand, while the interests of their own municipality tended to colour the vision of the members of the representative council. 7 Data on 2002. Statistics Finland, www.stat.fi. 8 Data for 2003. Les Collectivités locales en chiffres 2006 and L'Institut national de la statistique et des études économiques, www.insee.fr. 9 Data for 2003. They include social security expenses, not intergovernmental transfers. www.destatis.de. 10 Data 2002, INE, Finanza Pubblica 2004. They include social security expenses. 11 Data for 2004, Centraal Bureau voor de Statistiek, www.cbs.nl. They include social security expenses. 12 2003, Ministerio de Economía y Hacienda. 13 2004-2005, Local Government Financial Statistics England No. 16, 2005.

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CHAPTER 2 BART DE PEUTER & ELLEN WAYENBERG

BELGIUM: FLEMISH INTER-MUNICIPAL COOPERATION UNDER REFORM

1.

Introduction

Inter-municipal cooperation in Flanders is currently regulated by the framework decree of 6 July 2001, which aimed to drastically renew inter-municipal practice by introducing a full set of reforms. Each of them sprang from one of three guiding principles to which the Flemish government had adhered with regard to inter-municipal cooperation. The first was to legally anchor a variety of inter-municipal forms of cooperation. Second, regardless of its structure, intermunicipal cooperation should be sufficiently supervised by the councils of the municipalities involved. Hence, a number of reforms of the 2001 decree are based on the principle of (sufficient) democratic supervision. The third principle underlying the decree ensures the “purity” of inter-municipal cooperation, meaning it should primarily involve municipalities. The 2001 decree thus excludes the involvement of certain actors in each of its forms of inter-municipal cooperation. How far has the 2001 framework decree reformed the practice of inter-municipal cooperation in Flanders? And, more importantly, how has the local level appraised its reforms? Recently, the Flemish Ministry for Internal Affairs announced that it would answer these questions in an evaluation of the 2001 decree. Once finalised, this evaluation could serve to foster adaptations of the decree. The Flemish government has put itself behind the decree’s principles and has – by promise of its Minister of Internal Affairs – stated that it would revise the decree if necessary to reinforce its application (Keulen 2004: 23). In this chapter, we begin the evaluation by answering the questions raised above for the region called Westhoek, an area in the west of Flanders that covers the territory of 18 rather small municipalities. As such, the focus on Westhoek R. Hulst and A. van Montfort (eds.), Inter-Municipal Cooperation in Europe, 23–38. © 2007 Springer.

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guarantees a critical case study of the 2001 decree. After all, small municipalities specifically benefit from inter-municipal cooperation as a means of providing their citizens a level of service delivery that is equal to their larger counterparts’. A combination of document analysis and interviews with local representatives has allowed us to trace the recent reforms in inter-municipal cooperation in the Westhoek municipalities and report on their local appraisal. We present these findings after describing the reforms introduced by the 2001 framework decree. First, however, we need to review the intergovernmental setting in which the decree was launched. 2. Intergovernmental Setting of the Flemish Framework Decree of 6 July 2001 Approval of the framework decree on inter-municipal cooperation on 6 July by the Flemish Parliament marked the first time the matter was exclusively regulated. The Flemish Parliament, the legislative body of the Flemish government, exercises the competences of the Flemish Region and the Flemish Community. Both were founded as a result of Belgian state reform. During successive rounds of this reform, competences were withdrawn from the central (now federal) government and assigned to one of two types of state authorities: regions and communities. Three regions (Flemish, Walloon and Brussels) and three communities (Flemish, Frenchspeaking and German-speaking) were established. The regions were attributed with territory-oriented competences such as spatial planning and mobility. More individual-level competences such as those in welfare and education were directed to the communities. The competences of both the Flemish Region and the Flemish Community are jointly exercised by the Flemish government.1 This structure has thus far not been followed anywhere else in the country. As a result, the Flemish government has a unique strength – particularly with regard to its local counterparts. In Flanders, there are five provinces and 308 municipalities. From their point of view, the Flemish government is an important central government next to the federal one; it can steer them in a number of territorial and individual matters. Moreover, the Belgian regions – including the Flemish one – have gained crucial competences with regard to local government structure and functioning throughout the different rounds of state reform. The last round of 2001 is memorable in this regard. The Belgian regions gained competence for the organic legislation of their provinces and municipalities beginning January 2002. It was not until 2005, however, that the Flemish government voted an organic decree on municipalities and one on provinces – three years had passed before the government made use of its newly gained competency. However, this time span is short compared to the one concerning the competency for inter-municipal cooperation. Although it was fully regionalised in 1993, not until 2001 – eight years later – did the Flemish government launch a framework decree on inter-municipal cooperation.2 In the following, we clarify the reforms that were introduced by the decree and then evaluate their implementation and appraisal in Westhoek.

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3. Reforms and Principles of Flemish Inter-municipal Cooperation 3.1. Varying forms of inter-municipal cooperation The Flemish government has clearly based the 2001 framework decree upon the principle of variation as far as the legal form of inter-municipal cooperation is concerned (Van Walle 2001: 7-8). Previously, only the intercommunale, a statutory body under public law, was legally anchored in (federal) law. By comparison, the 2001 framework decree provided four different forms of inter-municipal cooperation. These can be divided into two “light” and two “heavy” forms with respect to their legal status and anchoring. The two light variants are the inter-local association (interlokale vereniging) and the project association (projectvereniging). The first one, the lighter of the two, is a form of inter-municipal cooperation that has no corporate personality and to which no managerial control can be delegated by the municipalities involved.3 At least two municipalities should be involved but other legal bodies under private or public law can participate. An inter-local association can be established on the basis of a mutual agreement that is not subject to any specific supervision by the Flemish government. This form of inter-municipal cooperation is to execute a joint project that does not require corporate personality.4 If the latter requirement prevails, the project association is the appropriate legal form. It is meant to let municipalities jointly plan, implement and evaluate a project. Unlike the inter-local association, not all legal bodies under public or private law are entitled to join this form of cooperation. At least two municipalities should be involved. Moreover, membership is limited to municipal companies, social service agencies (OCMWs), other project associations and the two heavy forms of inter-municipal cooperation. Together, these parties can establish a project association by signing a contract. This contract is sent to the supervising Flemish government, but for information purposes only.5 Both light forms of inter-municipal cooperation were introduced by the 2001 decree and sprang from the Flemish government’s acknowledgement of a local need for flexible forms of inter-municipal cooperation. Recently, the Flemish government gathered data concerning their use. As Table 1 makes clear, inter-local associations are currently more popular than project associations. Both forms also have sector popularity: where inter-local associations are predominantly used in the sports sector, project associations are primarily set up for cultural and archaeological activities. The Flemish government saw in these data that not only was there a local need for flexible forms of inter-municipal cooperation but also that this local need was met by the two light forms of inter-municipal cooperation in the 2001 decree (Christiaens 2005: 11-12). Similar figures regarding the two heavy forms of inter-municipal cooperation – the service association (dienstverlenende vereniging) and the mandated association (opdrachthoudende vereniging) – are currently not available. Both are “heavy” with respect to the legal prescriptions surrounding their establishment. They have to be thoroughly prepared by a body of representatives of all municipalities involved. The body has to draw up several

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documents – a management plan, a business plan, and a motivational note – and has to draft the form’s legal statutes. All these documents have to be united in a charter and approved by all municipalities involved. When other parties join, their decision has to be added to the dossier. Possible partners are the same as those entitled to participate in project associations. Last, the associations have to be approved by the Flemish government.6 Table 1: Inter-local and project associations according to sector of activity Sector of activity Sports Education Culture Library Finance Archaeology Youth policy Drug prevention Soil management Tourism Other Total

Inter-local associations 19 15 2 4 4 1 1 3 0 1 6 56

Project associations 2 0 3 0 0 3 2 0 2 1 0 13

(Source: Administratie Binnenlandse Aangelegenheden 2005: 11)

These legally-heavy prescriptions reflect the type of cooperation that the forms allow. A service association is intended to deliver a well-delineated service that concerns one or more policy areas. This form has a corporate personality but no managerial control delegated by the municipalities. Delegation of this control only applies in the case of a mandated association. The parties involved entrust the association with the implementation of one or more clearly specified competences in one or more functionally coherent policy fields. By doing so, they renounce their own right to perform either autonomously or with others the task(s) assigned to the mandated association.7 The existing intercommunales were to migrate to the heavy forms of cooperation within two years of the decree, i.e., by November 2003.8 But there are no data that explicitly divide the existing heavy forms of inter-municipal cooperation into the two new variants. The only data available merely describe the forms according to sector of activity (Table 2). There are currently 90 instances of heavy inter-municipal cooperation throughout Flanders, only five more than two decades ago (Administratie Binnenlandse Aangelegenheden 2005: 11). As such, the 2001 decree certainly did not increase heavy inter-municipal cooperation. Currently, this type of cooperation prevails in the sector of waste disposal.

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Table 2: Intercommunales according to sector of activity

Sector9 Energy TV-distribution Water distribution Regional development Waste disposal Medical-social sector Sports and recreation Finance Other Total

Intercommunales 15 7 7 14 22 4 5 7 9 90 10

(Source: Administratie Binnenlandse Aangelegenheden 2005: 11)

3.2. Democratic supervision over inter-municipal cooperation The second principle underlying the 2001 decree is that of democratic supervision. The decree strengthened this control to meet the frequent criticism of the classic intercommunales, which claimed that there was insufficient feedback on the decisions of these organisations to the councils of the participating municipalities. As a consequence, intercommunales were detached from the discretionary political power of the municipalities (Ory 2003: 52). Eight innovations of the 2001 decree are important to the enhancement of democratic control (Vlaams Parlement 2001: 107). When discussing these innovations we will also refer to the provisions of the decree concerning the inter-local and project associations. This will demonstrate how the latter forms of inter-municipal cooperation have a lighter structure than the mandated and service associations. A first reform concerns the duration of inter-municipal cooperation. The decree reduced the maximum duration in the case of heavy cooperation from 30 to 18 years.11 This reduction implies that municipal councils have to more frequently reflect on the continuation of their participation in a heavy form of cooperation and also restrains the life of the cooperative form itself. The duration is different for the light forms of inter-municipal cooperation: A project association can exist for six years at most and no maximum duration is determined for a inter-local association.12 A second reform regards the objectives of inter-municipal cooperation. The classic intercommunale could have multiple objectives. According to the old legislation, it was an association “with certain objectives of municipal importance” that had to “state its objective(s) in its statutes”.13 In comparison, the decree of 2001 increased the constraints on pursuing multiple objectives in both the service and the mandated associations. The decree requires clarity in this matter. As stated above, the service association is to deliver a well-determined service while the mandated association performs one or more clearly stated tasks in one or more functionally related policy areas.14 For both forms, the precise objective has to be stated in the statutes. Indeed, the decree prescribes that the articles have to determine the societal

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objectives of the association “in a clear and restrictive way”.15 When the association involved wants to pursue an additional objective, its statutes have to be amended. The decree also prescribes that such modifications be judged by the respective municipal councils.16 In comparison, the objectives of inter-local and project associations are limited. Both forms were created to manage projects of limited scope.17 The third reform of the 2001 decree to enhance democratic control is that objective-related modifications and all other modifications of the statutes of service and mandated associations must have the approval of the councils of the municipalities involved.18 Previously, only amendments entailing additional obligations or fewer rights for the municipalities involved had to be approved.19 The decree prescribes municipal approval of changes to the statutes of a project association but does not specify anything with regard to modifications of the contract on which a inter-local association is founded.20 At least twice a year, the council of each municipality involved in a service or mandated association receives a report on inter-municipal cooperation.21 This report is drawn up by the board responsible for the daily management of the intermunicipal form.22 In particular the board members have to report on the exercise of their mandate and clarify the form’s general policy. This report constitutes the fourth reform introduced by the 2001 decree; the former legislation contained no such provision. The board of a project association also has to report on the form’s activities to the parties involved. In the case of an inter-local association, the decree does not stipulate reporting.23 The board of directors is one of the two management bodies that the decree prescribes for service and mandated associations.24 The other is the general assembly, which is competent for – among other things – the appointment of the members of the board, the approval of the form’s accounts and decisions with regard to participations in other legal entities.25 The 2001 decree introduced three reforms with regard to the general assembly to increase democratic control on inter-municipal cooperation. First is the obligation to organise at least two meetings each year in which representatives of all parties involved – municipalities included – take part.26 The former legislation contained no provisions on the frequency of meetings. A second reform is that the representatives receive a mandate for one meeting only of the general assembly.27 Third, the delegation of municipal representatives is by the council and no longer by the municipality’s executive college of the mayor and aldermen.28 The project association operates with a board only. Board members are directly appointed by the participating parties. Participating municipalities can delegate councillors, the mayor and aldermen. The board must be chaired by a municipal representative and can only decide on matters explicitly entrusted to the project association.29 The inter-local association has the simplest structure, a managerial committee comprising delegates of each party involved. Participating municipalities can delegate councillors, the mayor and aldermen to this body, which – among other things – has to make decisions on the implementation of the inter-local agreement.30 The final reform of the 2001 decree to strengthen democratic supervision over inter-municipal cooperation concerns the opposition parties that are present within the municipal councils. They have to be represented by an advisory vote within the

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boards of the project, service and mandated associations.31 Such representation was not legally prescribed for intercommunales. As noted before, the intercommunales had until the end of November 2003 to switch over to either a service or mandated association and to adapt their statutes accordingly. The state of affairs in this matter is not yet documented. Hence, nothing can be stated about the impact the 2001 decree has had on the democratic supervision of inter-municipal activities throughout Flanders. 3.3. Pure inter-municipal cooperation Similarly, data on the effect of the two reforms of the 2001 decree that sprang from the principle of pure inter-municipal cooperation is unavailable. This is hardly surprising as the time period during which these reforms have to be implemented has not yet passed. The reason behind what might appear as a lag in effort is that both reforms will intensely change the country’s longstanding inter-municipal practices. The first is the abolition of mixed intercommunales. These are forms of intermunicipal cooperation founded under the former legislation in which private companies participate. Such intercommunales are quite prevalent throughout Flanders, as Table 3 shows. The municipalities themselves have never pleaded for the abolishment of mixed intercommunales because private partners usually provided considerable financial input. The Flemish government, however, argued that any form of inter-municipal cooperation should be regarded as an extension of the municipalities involved and participation of private companies in forms where municipalities have given them managerial control might lead to blurred municipal responsibilities and conflicts of interest. To avoid this, the mixed intercommunales should be abolished (Vlaams Parlement 2001: 107-108).32 Flemish municipalities have 18 years – until January 2019 – to purge inter-municipal cooperation of private partners by buying them out.33 According to the Flemish Association of Cities and Municipalities (VVSG), this is a financial “Mission Impossible” (VVSG, 2004: 1). Table 3: Intercommunales according to “purity” in a number of policy sectors

Sector Energy TV-distribution Water distribution Waste disposal Total

Pure intercommunales 7 2 5 17 31

Mixed intercommunales 8 5 2 5 20

(Source: Administratie Binnenlandse Aangelegenheden 2005: 11)

The 2001 decree introduced another reform based on the principle of pure inter-municipal cooperation that concerns the involvement of provinces, the local government next to municipalities. When preparing the 2001 decree, the Minister of Internal Affairs intended to prohibit any provincial involvement. His intent,

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however, was weakened by voting members of the Flemish Parliament and, as a result, the decree allows limited provincial involvement in inter-municipal cooperation. In particular, provinces may not contribute more than 20 percent of the capital of a project, service or mandated association, and are not allowed to participate in inter-local associations.34 This reduces provincial involvement in intermunicipal cooperation significantly; formerly, a province’s contribution to an intercommunale’s capital could exceed 50 percent.35 This reduction was to be realised by January 2007 but the Flemish government could extend it to 2013.36 In sum, the 2001 decree aimed to drastically renew Flemish inter-municipal cooperation by introducing a series of reforms.37 Its impact has thus far not been systematically evaluated. How much has the decree actually reformed inter-municipal practice? And, more importantly, how are its reforms appraised on the local level? In the remainder of this chapter, we will answer these questions for Westhoek. Our findings are based on document analysis and interviews with municipal and provincial representatives involved in inter-municipal cooperation in the area. 4.

Inter-municipal Cooperation in Westhoek

Westhoek is a 118,000-hectare area in the western part of Flanders with 18 municipalities. Their populations vary from 971 in Mesen to 35,089 in Ieper. These figures (Table 4) make clear that the majority of the Westhoek municipalities belong to Flanders’ smallest municipalities; the average Flemish municipality has about 20,000 inhabitants. As expressed by one of our interviewees, the small size of Westhoek municipalities creates urgency for “something to be done in the area to guarantee our citizens a sufficient level of service-delivery”. Whether that “something” is indeed inter-municipal cooperation will be addressed in the first section of this part. In particular, we focus on the forms of inter-municipal cooperation in use and their evaluation by local policy-makers. Next, we turn to the issue of democratic supervision of inter-municipal cooperation – the Westhoek respondents have a straightforward opinion on this matter. The last section is devoted to the important (and threatened) role that the Province of West Flanders plays in cooperation among the Westhoek municipalities. Table 4: The 18 Westhoek municipalities ordered by population Municipality Mesen Lo-Reninge Vleteren Alveringem Langemark-Poelkapelle Koekelare Heuvelland Houthulst De Panne

Population 971 3,288 3,588 4,881 7,669 8,219 8,322 8,957 9,852

Municipality Nieuwpoort Zonnebeke Veurne Kortemark Diksmuide Wervik Poperinge Koksijde Ieper

Population 10,595 11,570 11,859 12,079 15,494 17,526 19,433 20,498 35,089

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Varying forms of inter-municipal cooperation: A local need finally fulfilled?

All four forms of inter-municipal cooperation of the 2001 decree are currently employed in Westhoek. Of the two lighter forms, the inter-local association prevails. Seven of these associations currently exist; only one project association is in use (Table 5). The Westhoek area is representative of Flanders as a whole with respect to the frequency of inter-municipal cooperation vis-à-vis sector of activity. Throughout Flanders, inter-local and project associations (light forms) prevail in the sports and cultural sectors. (See Table 1.) Table 5: Inter-local and project associations in Westhoek according to sector Sector Sports Education Culture Library Finance Archaeology Youth policy Drug prevention Soil management Tourism Other Total

Inter-local associations 3 1 0 0 1 0 1 0 0 0 1 7

Project associations 0 0 1 0 0 0 0 0 0 0 0 1

(Source: Administratie Binnenlandse Aangelegenheden, 2005)

Westhoek has 11 heavy forms of cooperation (Table 6). Again, the picture is similar to the country as a whole (Table 2). Waste disposal is the activity in which the highest number of intercommunales operates. Table 6: Intercommunales in Westhoek according to sector of activity Sector of activity 38 Energy TV-distribution Water distribution Regional development Waste disposal Medical-social sector Sports and recreation Finance Other Total

Intercommunales 2 0 1 1 3 0 0 1 3 11

(Source: Administratie Binnenlandse Aangelegenheden, 2005)

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In sum, the Westhoek municipalities employ all four forms of the 2001 decree to shape their mutual cooperation. But does this fulfil the municipalities’ need for variety in inter-municipal forms of cooperation? This question has both negative and positive responses. Their negative response is based on the fact that the Westhoek municipalities had not waited until the 2001 decree to cooperate among themselves. As explained before, the decree is primarily an extension by introducing two light forms of inter-municipal cooperation. However, this did not prevent the Westhoek municipalities from cooperating and using the provisions of other legislation to legally shape their cooperation. As one respondent observed, “Sports, for example, is an activity around which we have cooperated with each other in Westhoek for more than 20 years now. And in order to do so, we used the formula of a non-profit organisation or we made agreements with each other”. Once the 2001 decree was in force, the municipalities were to opt for either an inter-local association or a project association to legally frame their cooperation but, in some cases, this turned out to be impossible. The most frequently cited and striking example in this regard is Westhoekoverleg, a cooperation between the 18 Westhoek municipalities that has existed since 1994 and has grown organically through mayoral communications. In fact, this cooperation could be framed as a project association but, in the words of another respondent, “Such an association is ideal when municipalities cooperate around a specific project. But in case of Westhoekoverleg, the inter-municipal cooperation involves all kinds of matters and projects. And this sort of cooperation can not take place in a project association according to the [2001] decree”. As a result, Westhoekoverleg currently “does not exist from a Flemish point of view while it signifies so much for us here in Westhoek.” Another respondent amplified this by referring to the inter-local association of Westhoekpersonel. This is a cooperation of the Westhoek municipalities that jointly employs personnel for cultural activities, spatial planning and environmental issues. According to this respondent, its managerial committee is “a paper construction in the sense that all decisions are actually made within the Westhoekoverleg”. In other words, the Westhoekoverleg that signifies so much for the Westhoek municipalities cannot “fit” into the 2001 decree without drastically altering its way of working. And this example illustrates why the decree with its variety of inter-municipal forms does not fulfil the Westhoek municipalities’ needs. As expressed by one local respondent: “The decree actually forces us from the start of any cooperation to pin ourselves down to one specific form with all its rules and regulations whereas we should be given the space to grow in our mutual cooperation – such as in the case of Westhoekoverleg – without having to follow all kinds of rules and regulations. After all, what finally matters? The fact that something is inter-municipally taken care of. And the legal form for this cooperation? Well, this form should then just be tailored to the actual cooperation”. On the other hand, the variety of forms of inter-municipal cooperation of the 2001 decree has been positively regarded in Westhoek. Two arguments underlie this response. First, several respondents pointed to the fact that the decree has finally provided a legal anchor for light forms of inter-municipal cooperation. The project association in particular has been welcome in this regard. In the words of one

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respondent: “This form really meets a need of municipalities to be able to set up a partnership among themselves for the realisation of a specific project that does not exceed the local term”. At first glance, this seems rather surprising as there is currently only one project association active in Westhoek as opposed to seven interlocal associations. However, the latter have, for the most part, evolved from longstanding inter-municipal cooperation whereas the sole project association, Overleg Cultuur Zuid-West-Vlaanderen, has only recently been founded under impulse of the Flemish government’s decree on local culture policy that – as expressed by another respondent – “prescribes the use of one of the forms of the 2001 decree in case of inter-municipal cooperation. And the project association turned out to be ideal for the cooperation we wanted to set up in the field of cultural policy”.39 This brings us to the second argument underlying the positive response to the 2001 decree in Westhoek. The above mentioned local culture policy illustrates what several respondents described as “another positive development on the part of the Flemish government” apart from the 2001 decree with its variety of inter-municipal forms of cooperation. It implies that the Flemish government “does not come up anymore with strongly-regulated variants on the forms that are anchored in the legislation on inter-municipal cooperation in every domain-specific decree it votes.” Put differently, the Flemish government has started to treat the 2001 decree as a genuine framework that applies whenever inter-municipal cooperation is at stake. Until now, there have been domains in which the Flemish government was said to “refuse to live according to its own rules and this complicates our lives on the local level.” Not surprisingly then, this development was repeatedly applauded by Westhoek respondents. 4.2. Democratic control over inter-municipal cooperation: A longstanding deficit finally tackled? As pointed out, the 2001 decree contains a number of reforms with the view of safeguarding sufficient democratic control over activities of inter-municipal cooperation. The Westhoek interviewees recognised the problem that the decree sought to tackle. In the words of one of them: “one often encounters the situation in which some sort of inter-municipal cooperation is set up and after a while nobody bothers to ask: Must this cooperation continue? Is it working properly? Should it not be aligned with another form of cooperation? And so, the cooperation starts leading a life of its own. Now, with the [2001] decree, the council [of the municipalities involved] has the task of periodically reflecting on these questions. That is a good thing. Of course, there is a difference in this regard between, on the one hand, the inter-local association and the project association and, on the other hand, the service association and the mandated association.” The interviewee thus differentiated the two light and two heavy forms of inter-municipal cooperation. In his view, they do not only differ in legal anchoring but also by the treatment they receive when appearing on the agenda of a municipality’s council. After all, “Issues concerning the inter-local association and the project association are usually well-debated and questioned. But the same can not be said in case of the two other forms [of heavy

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inter-municipal cooperation]. The councillors who represent municipalities in these forms’ organs usually provide short but well-grounded information whenever an issue about the cooperation is at stake in the council of their municipality. But more often than not, the other councillors present just take notes. And then there is a vote and they all move to another agenda issue. So, in general, there is little debate in municipalities about the activities of the service and mandated associations in which they are involved.” The other respondents confirmed this practice which thus points to a larger democratic deficit in these two forms compared to the inter-local and the project associations. Going beyond universal recognition of this difference, the Westhoek respondents were also unanimous in their explanation for it, which revolves around the issue of the municipal “core tasks”. According to our interviewees, the tasks that are inter-municipally handled in Westhoek via a light form are seen as municipal core tasks by the councillors involved. As indicated, these tasks primarily concern sports and cultural activities. And in the words of one respondent, “Such tasks are typically municipal. After all, every municipality – even the smallest one – needs to organise sports activities such as a good cycling or hiking tour for its inhabitants. And it needs to have a cultural policy involving the local brass band or the theatre. And even when such activities are inter-municipally organised, the councillors keep their eyes on them. Because these sorts of activities are specifically made for and with the citizens of their municipality.” The same was not said on behalf of the tasks of the service and the mandated associations in which Westhoek municipalities currently participate. As observed by another respondent with regard to the distribution of electricity, a task that is handled by several intercommunales in the area, “This task is not our core business as municipalities. It has nothing to do with municipal democracy and autonomy. The only thing citizens want is their electricity to be distributed as cheaply as possible. Electricity distribution is not a task that needs to be implemented via measures that are made to the size of the citizens of a specific area. The same goes for other tasks such as water supply and waste disposal. They are not our core business.” And this was put forward as explaining why municipal councillors do not tend to “keep their eyes on” these tasks when they are at stake in a council meeting. Given this diagnosis to the problem of the democratic deficit in case of intermunicipal cooperation, the remedy was quite straightforward in the respondents’ view. It does not lie in launching a decree that prescribes all kinds of measures to safeguard a municipal council’s control over tasks that are inter-municipally handled. They agreed that the remedy lies elsewhere, i.e., in reopening the socalled core task debate among Flanders’ governmental layers. Such a debate was held in the period 2001-2003. It was closed off by political agreement between the Flemish government and the representative associations of both the provinces and the municipalities. But none of our local interviewees was impressed by it because, as one of them observed, “If this debate had been properly held and implemented, the problem of the democratic deficit in the case of inter-municipal cooperation would have been solved a long time ago because the tasks that are

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suffering from the largest deficit would have already been taken away from the municipalities.” 4.3. Pure inter-municipal cooperation – and what about longstanding intergovernmental cooperation? The two reforms of the 2001 decree that aim to purify inter-municipal cooperation were granted a longer time span to be implemented than any other, which gives rise to the difficulty of evaluating their impact. As far as Westhoek is concerned, one thing is beyond question: the respondents did not applaud the decree’s intent to abolish private involvement and to drastically downsize provincial involvement in heavy inter-municipal cooperation. A clear indication lies in the lack of progress that Westhoek municipalities have made in preparing for these reforms; few preparatory measures have been taken to buy out private companies or provinces, including the Province of West Flanders’ involvement in the West-Vlaamse Intercommunale (WVI). The latter is the only service association in which all 18 Westhoek municipalities are involved. This seems particularly striking because the provinces are legally bound to be bought out by January 2007 whereas the time span regarding private companies ends 11 years later. The Westhoek municipalities do not, however, risk being sanctioned because they used the decree’s provision to extend their deadline to buy out the Province of West Flanders by six years. Managing this required the province’s agreement but, in the words of one provincial respondent, “this was no problem at all because WVI is “a provincial child.” We have founded “this association together with the municipalities and we want to continue our involvement in it.” Moreover, if the province is bought out, it is believed that it will still devote “all available money on cooperation with municipalities because, here in Westhoek, we have a very strong tradition of working together if we are threatened by the Flemish government in this regard.” Other provincial and municipal respondents recognised this threat, and not just as a result of the 2001 decree on inter-municipal cooperation. Other decrees of a more domain-specific nature were mentioned, such as the decrees of October 1997 on nature conservation and May 2004 on socio-economic policy. These kinds of decrees make provisions for cooperation between provinces and municipalities, but they all tend to do it in such a domain-specific and detailed way that one respondent observed (regarding the Province of West Flanders and Westhoek municipalities), “We all have to spend a lot of time and energy to figure out and apply the specific rules that count in each domain. And this is extremely pernicious for the debate that we are eventually supposed to have with each other about the objectives of our cooperation.” In our respondents’ view, a possible way out of today’s threatening situation for the future cooperation between the Province of West Flanders and the Westhoek municipalities lies in the voting of a Flemish framework decree on intergovernmental cooperation. Such a decree currently does not exist, nor does any other document with even simple advisory or guiding notes on the matter. But if the Flemish government follows this suggestion, it should take the respondents’ request into account not to repeat the mistakes made in the 2001 decree on

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inter-municipal cooperation. As expressed by one, “It should not be another decree made with so little consultation with the local level that it results in overregulation of that level.” 5. Conclusion In this chapter, we focussed upon the Flemish framework decree of 6 July 2001 on inter-municipal cooperation. Our aim was to evaluate the decree’s impact of its numerous reforms in the Westhoek area. A first reform was based upon the principle of varying the legal forms for inter-municipal cooperation: the decree provides four forms where there used to be only one. But as far as the Westhoek municipalities are concerned, their need to shape cooperation in various ways is not yet fulfilled. Westhoekoverleg – which currently is the most important structure of cooperation in the area – could not be framed within any form of the 2001 decree. Furthermore, this decree introduced a series of reforms on the basis of the principle of democratic control over inter-municipal cooperation. In other words, whenever tasks are intermunicipally handled, they should be sufficiently supervised by the councils of the municipalities involved. In Westhoek, however, there still is a democratic deficit with regard to tasks that are subject to “heavy” inter-municipal cooperation. Finally, the 2001 decree also aimed to reform inter-municipal practice from the principle of pure cooperation. The decree sought to abolish the involvement of private companies and downsize the involvement of provinces in heavy cooperation. Although the time span to implement either reform has not yet passed, little preparation has been undertaken in Westhoek because the municipalities are not keen on the reforms. The latter one – downsizing provincial involvement – is especially dismaying because it threatens the longstanding and mutually appreciated working relationship between the Province of West Flanders and the Westhoek municipalities. These are the most important findings of our evaluation of the 2001 decree in Westhoek. Its 18 municipalities are all rather small and cooperation is not always the most important but often the only way of delivering high quality services to their citizens. There are an additional 290 municipalities in the country, some larger than those of Westhoek, others not. All of them deserve to be heard by the Flemish government before it proceeds to drastically alter its framework decree on inter-municipal cooperation. References Administratie Binnenlandse Aangelegenheden. (2005). De Vlaamse dienstverlenende en opdrachthoudende intergemeentelijke verenigingen in cijfers (1987 – 2002). Brussel: Administratie Binnenlandse Aangelegenheden. Christiaens, A. (2005). De interlokale vereniging en projectvereniging: een succesverhaal? Binnenband 44, 11-12. Eyckmans, G., & Suykens, M. (2002). Interlokale samenwerking. Brussel: VVSG.

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Keulen, M. (2004). Beleidsnota Binnenlands Bestuur 2004 – 2009. Brussel, Vlaams Minister van Binnenlands Bestuur, Stedenbeleid, Wonen en Inburgering. Ministerie van de Vlaamse Gemeenschap – Algemene Planningsdienst. (2005). Vlaamse Regionale Indicatoren. Ministerie van de Vlaamse Gemeenschap – Algemene Planningsdienst. Ory, G. (2003). Intergemeentelijke samenwerking: Een keuze voor de gemeenten. Terzake, 2003 (1), 5152. Provincie West-Vlaanderen. (2004). Gebiedsgerichte werking anno 2004. Brugge, Provincie WestVlaanderen. Van Walle, E. (2001). De intercommunale samenwerking in Vlaanderen – Vlaams Parlement keurt decreet goed. Binnenband, 24, 7-15. Vlaams Parlement. (2001). Ontwerp van decreet op de intergemeentelijke samenwerking – Memorie van toelichting. In: Administratie Binnenlandse Aangelegenheden, Decreet van 6 juli 2001 houdende de intergemeentelijke samenwerking (105-128). Brussel: ABA. VVSG. (2004). Decreet van 6 juli 2001 houdende de intergemeentelijke samenwerking. Knelpuntennota, oplossingsvoorstellen. Brussel: VVSG.

Notes 1

The geographical areas for which the Belgian regions and communities are competent do not coincide. As a result, the Flemish government exercises regional competences with regard to the territory of the Flemish Region and community competences on behalf of the Flemish-speaking citizens of both the Flemish and the Brussels Region. 2 The Flemish government voted a decree on inter-municipal co-operation in 1987, but it only arranged a limited number of aspects concerning Flemish inter-municipal cooperation while the rest was grounded in a (federal) law of 1986. 3 “Delegation of managerial control” means that the established form of inter-municipal cooperation is fully entrusted with and thus responsible for the realisation of objectives that are pursued by the founding municipalities. The latter then renounce the realisation of these objectives. 4 Art. 6 and 7 of the decree of 06-07-2001. 5 Art. 10, 12 and 14 of the decree of 06-07-2001. 6 Art. 25, 16, 18, 29 and 30 of the decree of 06-07-2001. 7 Art. 12 of the decree of 06-07-2001. 8 Art. 79 of the decree of 06-07-2001. 9 Concerning the grouping of intercommunales according to sector of activity, it has to be taken into account that “energy” is electricity and/or gas and/or TV-distribution, “TV-distribution” is this activity only, “regional development” is sometimes joined with waste disposal, “waste disposal” is this activity only, “finance” concerns several activities to increase the capital participation of municipalities that are members of a mixed intercommunale for the distribution of electricity and gas (Administratie Binnenlandse Aangelegenheden 2005: 11 and 84). 10 The figures for 2005 refer to a listing of Flemish intercommunales dated January 1, 2003. This list was updated in June 2005. Therefore it is possible that more heavy forms of inter-municipal cooperation currently exist. In this perspective, the figures for 2005 must be interpreted as minimums. 11 Art. 7 of the act of 22-12-1986. Art. 34 of the decree of 06-07-2001. 12 Art. 13 of the decree of 06-07-2001. 13 Art. 1 and 4 of the act of 22-12-1986. 14 Art. 11 of the decree of 06-07-2001. 15 Art. 38 of the decree of 06-07-2001. 16 Art. 39 of the decree of 06-07-2001. 17 The articles of an inter-local association are stipulated in an agreement among the parties that establish the association (Art. 7 of the decree of 06-07-2001). 18 Art. 39 of the decree of 06-07-2001. 19 Art. 9 of the act of 22-12-1986.

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Art. 15 and 7 of the decree of 06-07-2001. Art. 53 of the decree of 06-07-2001. 22 In both service and commissioned associations, this responsibility can be delegated to a managerial committee (Art. 54 of the decree of 06-07-2001). 23 Art. 16 of the decree of 06-07-2001. 24 Art. 43 of the decree of 06-07-2001. As stated, a managerial committee can be established by the board of directors. Under certain conditions, advisory committees can also be established and the support of experts is allowed (Art. 54 and 55 of of the decree of 06-07-2001). In service and commissioned associations, financial control is in the hands of one or more commissioners or revisers, which are appointed by the general assembly (Art. 61 of the decree of 06-07-2001). 25 Art. 46-60 of the decree of 06-07-2001. 26 Art. 44 of the decree of 06-07-2001. 27 Art. 44 of the decree of 06-07-2001. 28 Art. 44 of the decree of 06-07-2001 and Art. 12 of the act of 22-12-1986. 29 Art. 16 of the decree of 06-07-2001. 30 Art. 9 of the decree of 06-07-2001. 31 Art. 16 and 52 of the decree of 06-07-2001. 32 As said, municipalities only delegate managerial control if they opt for intercommunales to switch to a mandated association as the heavy form of inter-municipal cooperation. The 2001 decree excludes private actors from participating in the service association as well. Consequently, pure heavy inter-municipal cooperation is only possible under the 2001 decree. As far as the decree’s two light forms are concerned, participation of private actors is only possible in inter-local associations (the lightest form of the decree). For the sake of completeness, it has to be emphasised that the 2001 decree only regulates inter-municipal cooperation. Cooperation between a single municipality and one or more private actors is legally anchored in the Flemish decree of 18 July on public-private cooperation. 33 Art. 80 of the decree of 06-07-2001. 34 Art. 22 and 63 of the decree of 06-07-2001. 35 Art. 19 of the act of 22-12-1986. 36 Art. 80 of the decree of 06-07-2001. 37 In the preceding parts, we limited ourselves to summarising the most important reforms of the 2001 decree based on its three underlying principles. 38 Concerning the typology of intercommunales, it must be taken into account that “energy” is equal to electricity and/or gas and/or TV-distribution and “TV-distribution” concerns this activity only. 39 The decree referred to is that of 13 July 2001 on the promotion of an integrated and high-quality cultural policy on the local level. 21

CHAPTER 3 ARTO HAVERI & JENNI AIRAKSINEN

INTER-MUNICIPAL COOPERATION IN FINLAND: OLD TRADITIONS AND NEW PROMISES

1.

Introduction

For almost 100 years, inter-municipal cooperation has been a general way of taking care of activities for which individual municipalities are too small. Over the past decade, however, the importance of cooperative strategy has increased considerably. Cooperation is seen as a tool for strengthening local authorities’ ability to ensure the mandatory level of service delivery and to carry out active local economic development policy. In this contribution, we describe the current situation of inter-municipal cooperation in Finland, evaluate the advancement of this cooperative strategy as part of new local governance, and present ideas on the future development of inter-municipal cooperation. The analysis is based on extensive research concerning cooperative activities, and draws in particular from an evaluation study undertaken at the University of Tampere in 2002-2005. 1 2.

The Finnish Administrative System and the Position of Local Government

The public administration of Finland comprises the highest organs of government (Parliament, the President of the Republic and the Government) and three administrative levels (central, regional and local). Despite having three levels, the Finnish administrative system is strongly driven by central and local governments. There is only one municipal level (kunta) in Finland; at the regional level, there is no independent or democratically elected all-purpose organisation. Neither are the state organisations working at the regional level as significant as the central and local levels. R. Hulst and A. van Montfort (eds.), Inter-Municipal Cooperation in Europe, 39–65. © 2007 Springer.

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The municipalities constitute an essential part of public administration and society. Local government in Finland is characterised by a high degree of autonomy and based on local self-government, safeguarded by the Finnish Constitution. Municipalities are responsible for providing a wide variety of welfare services for their residents, the most important of which relate to social welfare, health care, education, culture, the environment and technical infrastructure. Many functions that are considered by most countries to be regional level functions – such as public hospitals, upper secondary schools and adult education centres – are the responsibility of Finnish municipalities. A total of 430,000 employees, or approximately one-fifth of the Finnish work force, serve municipal residents. Local governments claim about 18 percent of the Finnish gross national product. The public expenditure of local governments is €31 billion, whereas the public expenditure of the Finnish State amounts to €38 billion. At the start of 2006, Finland had 431 local governments. The areas over which they govern vary greatly, from densely-populated urban cities to sparsely-populated remote rural areas. Helsinki has a population exceeding half a million; the smallest local authorities on offshore islands have fewer than 200 residents. Over 50 percent of Finnish municipalities have fewer than 6,000 inhabitants (Figure 1). Figure 1: Number of municipalities by size of population (Source: The Finnish Association on Local and Regional Authorities, 2006)

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According to legislation, all municipalities have the same responsibilities, including those for costly tasks like specialised hospital care. This means that many Finnish municipalities are very small vis-à-vis the scope of their tasks. When this notion is combined with the fact that the local government system is single-tiered, it is no wonder that inter-municipal cooperation has long traditions in Finland. 2.1. Local government tasks, organisation and finance Finnish municipalities provide their residents with many welfare services and are also responsible for the development of these services. These include both voluntary functions for the benefit of the residents and mandatory functions as specified by various laws. The mandatory tasks of municipalities account for 89-90 percent of all municipal expenditure. The most important services provided by local authorities concern health care and social services, education, and maintenance of the technical infrastructure. According to legislation, all municipalities, regardless of size, have the same obligatory tasks and responsibilities. Thus smaller municipalities often rely on cooperative arrangements to handle those tasks that require a large population base. Local governments: • • • • • • • •

Run the country’s comprehensive and upper secondary schools, vocational institutions and polytechnics; Provide adult education, art classes, cultural and recreational services, and run libraries; Provide child day-care, welfare for the aged and disabled, and a wide range of other social services; Provide preventive and primary care, specialist medical care and dental care; Promote a healthy living environment; Supervise land use and construction in their area; Are responsible for water and energy supply, waste management, street and road maintenance and environmental protection; and Seek to promote commerce and employment in their area.

Finnish local governments are self-governing units where the highest decisionmaking authority is in the hands of local councils elected by residents. Every four years residents of municipalities elect a local council in a free and democratic election to decide on the municipality’s finances and operations. The council size is proportional to the local population over which it presides; the smallest council has 13 councillors and the largest 85. The municipal executive board, which is appointed by the council, does the preparatory work on matters decided by the council. The board is responsible for the municipality’s day-to-day administration and financial management. The chief executive officer is an official appointed by the local council, who serves under the municipal executive board. The position of the chief executive officer in the local political-administrative system is distinctly different from other Nordic countries. The political-administrative axis is represented not by the chief executive officer and the mayor, but by the collective body of politicians and the CEO.

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Local authorities finance their annual expenditures with taxes, central government transfers, miscellaneous charges and sales revenues. Local income taxes, real estate taxes, and a share of corporate taxes account for almost half of all municipal revenues. Central government finance provides about 17 percent of all municipal revenues; about 27 percent comes from fees and other charges. Central government grants are awarded in exchange for statutory services, and the transfer system evens out the financial inequalities of local governments and ensures equal access to services throughout the country. Each local authority decides independently on its income tax rate, the average being 18 percent of taxable income (Figure 2). Figure 2: Total municipal sector income (Source: The Finnish Association on Local and Regional Authorities 2006)

2.2. Local governments and regional administration Finland is divided into 19 regions plus the autonomous province of Åland, and into 85 sub-regions, which are composed of local authorities and municipalities. The most important regional institution is the Regional Council (maakunnan liitto), which acts as the region’s planning and economic development organisation. Regional Councils are statutory joint municipal authorities, and they rely on the power and resources of their local government members. The delegates of the decisionmaking bodies of the Regional Councils are political appointees named by the

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member municipalities. They represent the political will of the inhabitants of the region via local elections. The Regional Council has no power to levy taxes and no important regulatory power. Its primary power rests with its role as an important actor in EU regional policy and on its position as the regional planning organisation. However, the Regional Council derives its real strength from its planning capacity, knowledge base, research expertise and the personal influence and networks of its leading experts. Two other joint municipal authorities work at the regional level: 17 regional districts for the care of the disabled, and 20 regional hospital districts, which are responsible for special health care and the management of hospitals. Sub-regional activities of the 79 functional regions are based on municipal cooperation, which is becoming increasingly common and diverse. It can involve land use planning, economic development policy, transport and communications systems, environmental care, and other service sectors. There is considerable variation in the degree of formality of decision making and administrative procedures of the sub-regions. State regional authorities perform regional-level tasks allocated to them by central government and direct the activities of State local administration. The main State regional authorities are the State Provincial Offices, Employment and Economic Development Centres, Regional Environment Centres and the regional offices of the Finnish Road Administration. In addition, a large number of district authorities operate in different administrative branches. The organisation of state authorities at regional and local level is characterised by fragmentation and sectorisation. 3.

Inter-municipal Cooperation: Legal Framework

Inter-municipal cooperation is supported by laws and regulations dating back to 1898. The legal framework of today’s inter-municipal cooperation can be divided into two categories: • •

European Charter of Local Self Government Basic Finnish legislation concerning the municipalities and their cooperation.

The latter category includes the Finnish Constitution, the Finnish Local Government Act, and the Act on the Helsinki Metropolitan Area Council 3.1. European charter for local self government The aim of the European Charter for Local Self Government is to create a set of European standards to give dimension to and protect local self government in Europe. The charter requires the members of the European council to carry out basic rules that ensure political, administrative and economic independence. The charter, then, expresses the political will the European council has worked toward. Finland entered the Council of Europe in 1989, signed the charter in 1990 and

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enforced it in 1991. Article 4 of the charter concerns the scope of local self government: “Public responsibilities shall generally be exercised, in preference, by those authorities which are closest to the citizen. Allocation of responsibility to another authority should weigh up the extent and nature of the task and requirements of efficiency and economy…”

Since the nature of local authorities' responsibilities is fundamental to the reality of local self-government, it is in the interests of both clarity and legal certainty that responsibilities should not be assigned to them on an ad hoc basis but should be sufficiently rooted in legislation. In Article 4, the general principle that the exercise of public responsibilities should be decentralised is clearly stated. Interpreted from the point of view of Finnish administrative system, this means that public services should primarily be taken care by municipalities. When tasks and responsibilities are allocated to inter-municipal bodies, the extent and nature of their requirements of efficiency and scale should be taken into account. This implies that, unless the size or nature of a task is such that it requires treatment within a larger territorial area or there are overriding considerations of efficiency or economy, it should generally be entrusted to the most local level of government, which, in Finland, means municipalities. According to the European Charter for Local Self Government, the municipalities are free to determine their own internal structures in order to adapt them to local needs and ensure effective management. According to the charter, they also can decide to cooperate with other municipalities or parties. This is formulated in the charter as follows: “Local authorities shall be entitled, in exercising their powers, to cooperate and, within the framework of the law, to form consortia with other local authorities in order to carry out tasks of common interest.” In the explanatory report, it is emphasised that cooperation is to be formulated on a functional basis with a view toward seeking greater efficiency through joint projects or carrying out tasks which are beyond the capacity of a single authority. Such cooperation may take the form of the creation of consortia or federations of authorities, although a legal framework for the creation of such bodies may be laid down by legislation. Such is the case in Finland. 3.2. Finnish legislation concerning inter-municipal cooperation Finnish Constitution. From the point of view of municipalities, the basic article of the Finnish Constitution is Article 121, which states that the government of municipalities should be based on the autonomy of its residents. In inter-municipal cooperation, this means that the integrity of municipal autonomy is to be taken into account when tasks are given to an inter-municipal organisation. In Finland decision-making power concerning the constitutional protection of municipalities rests on the hands of the Committee for Constitutional Law. In its reports concerning inter-municipal cooperation, the Committee has stated that, as long as the administration is arranged in an expedient way and the tasks are of an inter-municipal nature, some of the decision-making power of municipalities can be ceded to an inter-municipal body. Thus far the allocation of responsibilities to intermunicipal bodies has been suitable relative to Finnish municipal autonomy. The

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Committee has also emphasised that the aim of inter-municipal cooperation should not weaken the significance of municipal autonomy by moving all the important tasks to inter-municipal bodies or otherwise beyond the influence of a single municipality. Finnish Local Government Act. The main regulations concerning inter-municipal cooperation can be found in the 1995 Finnish Local Government Act, which is very flexible regarding inter-municipal cooperation. Chapter 1, section 2 reads: “Local authorities shall perform the compulsory functions either alone or in cooperation with other local authorities. Local authorities may also secure the services they need to perform their functions from other service providers”. This means that municipalities can produce statutory services by themselves, produce the services in cooperation with other municipalities, and purchase services from other municipalities, federation of municipalities, or public sector organisations. Additionally, municipalities can form their own private corporations, become part of private organisations, or purchase services from private sector organisations. Section 76 defines the forms of cooperation quite clearly: “By virtue of an agreement, local authorities may perform their functions jointly. Local authorities may agree to have a function performed by one local authority on behalf of one or more other local authorities, or that a function will be performed by a joint municipal board. Local authorities may also agree that a function prescribed by law as resting with a local authority or one of its authorities, in which power can be delegated to an officeholder, shall be delegated with public liability to an officeholder in another local authority. A local authority's duty to belong to a joint municipal board in a given sector and in some specified area is provided for separately.”

Services are defined to include all functions but official ones. Functions that require official authority can not be ceded to an inter-municipal body. For example, a master plan can be purchased from a private actor, but its administrative preparation work and actual decision making is the responsibility of the municipal organisation itself. Even if the local government act enables many different ways of arranging the services needed, Finland’s geography, with its long distances and fragmented population, makes this variety less active in practice. However the service production comes about, the essential notion is that services be arranged in the most expedient and economical way. Joint municipal authority is the most common organisational form in inter-municipal services. It is subject to a separate public law, which has its own administration and finances. Joint municipal authority is based on a basic agreement accepted by all the relevant municipal councils. Joint municipal authority is governed by a council or comparable organ comprising persons elected to a position of trust in the participating municipality. Members are chosen by municipal councils. A local government act states that all the organs of a joint municipal authority must be equivalent to the relative political strength of municipal councils in the area. This means that the composition of organs should be adjusted to correspond to the proportion of votes obtained by the joint municipal authority by various political groups represented in councils of local member authorities.

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Act on the Helsinki Metropolitan Area Council. The Helsinki area has its own legislation on metropolitan governance in Finland. By this law, the cooperative organisation of Helsinki, Vantaa, Espoo and Kauniainen (YTV) is a subject to public law. The Helsinki metropolitan area council has competencies in waste management, public transportation and air protection. It has additional functions like data management. In waste management, YTV gives regional instructions and is responsible for the guidance and transport of waste from residential buildings. YTV plans for and purchases public transportation in the region and is responsible for monitoring air quality, and seeing to its research and education. YTV also takes care of the research and planning functions concerning the metropolitan area and common functions of the member municipalities. Together, member municipalities can give YTV other functions comparable to its present tasks. YTV has the right to enter into contracts and take matters to court. The highest power of decision is in the hands of a metropolitan council made up of 11 members from Helsinki, five from Espoo and Vantaa and one from Kauniainen. The municipalities choose their own members. 4. Understanding the Widening Need for Cooperation The idea that inter-municipal cooperation should be widened seems to be widely accepted among the decision makers of local governments. According to a survey, to which 922 municipal and inter-municipal clerks and politicians from eight regions and over 50 municipalities responded, the need for cooperation was seen very clearly (Airaksinen, Haveri&Vallo 2005). Deepening cooperation seems to be the current direction, especially in services. Social and health care services are at the top of the list, but all services in inter-municipal cooperation are seen as important. To better analyse the need for cooperation in Finland, we approach it from three main perspectives: Economic, political and socio-demographic. 4.1. The economic perspective The economic perspective is probably most often discussed. For local governments, it usually percolates from increasing competition and growing financial pressures. As we all know, the globalisation of markets and competition also transform the environments of national and local governments. Globalisation and a trend towards an information society are felt in local governments, most acutely in those where an industrial factory has closed down, or those which outsource their economic activities to another country or region. The effect is strengthened by the fact that the financing of local government depends heavily on local taxes; municipalities are forced to plan and implement active strategies to foster local economic development. Amid growing economic competition, local governments have to defend themselves and seek new ways of surviving. Skilled labour, research institutions and an environment that can give rise to and attract new jobs are important for every municipality. By themselves, local governments have difficulties in providing the facilities needed to attract new companies and additional taxpayers. Working together, different assets can be combined and coordinated, offering something to companies that value technology, information, recreational amenities and a good environment.

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Practically, financial pressures mean imbalance in the responsibilities of municipalities and the prerequisites for taking care of these tasks. The number of tasks has considerably increased and many municipalities’ resources are inadequate to take properly care of them. This growth in tasks was the fastest when the welfare state was being built and reinforced from the 1960s to the late 1980s, but municipalities have also been given many new responsibilities during the last decade. Expansion in services has occurred, and the municipality has typically been the organisation obliged to provide the resources for them. Whereas the responsibilities of municipalities have grown, the resources for taking care of these tasks have not. In previous decades, new tasks were typically followed by grants and other types of assistance to the local governments. During the recent decade, there has been a substantial decline in the amount of funds allocated for the tasks. 4.2. Political perspective The political perspective refers both to international and national policies and reforms. At the international level, EU policies are often considered unifying by nature, creating pressures to assemble national practices. One example is the aim of strengthening the role of regions in Europe, a development that directly calls for increased cooperation at Finland’s sub-regional level. The most important reform to affect cooperation of local governments was the establishment of sub-regions (labour-market regions) in 1994. European Union regional policy was an important factor in this, because the reform was partly in response to the structural policy and statistical requirements of the European Union. The EU’s regional policy is implemented through the five-level hierarchical classification of regions (Nomenclature des Unités Territoriales Statistiques, NUTS). In this classification, labour-market regions form the NUTS level 4 and single municipalities the NUTS level 5. At present there are 82 labour-market regions, some of them densely inhabited; the largest have more than 100,000 inhabitants and smaller ones only 10,000 inhabitants. The sub-regions were defined mainly on the basis of employment and inter-municipal cooperation. The establishment of labour-market regions forced municipalities to plan regional strategies and implement development policies together and within the scope of labour-market regions. This, in turn, led to an increasing cooperative learning process inside labour-market regions. When local governments planned and organised their regional development within the EU structural policy, they learned the “basics of cooperation,” that is, how to do things together. Also many other administrative reforms have been important in activating cooperation among municipalities. In the ten-year period beginning at the end of the 1980s, Finnish local government – as well as the whole public sector – underwent more reform than in the history of Finland as a sovereignty. The principles of New Public Management (NPM) were clearly visible in pivotal local government reforms. Such NPM themes as decentralisation, lightening of bureaucracy, empowerment of market mechanisms, decreased regulation, and a shift from input budgeting to a stronger focus on results were the main mechanisms of the reforms. These reforms have given local governments more freedom, but have also increased their responsibility for services and regional development. According to Heinz (2000),

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who carried out a comparative study on the cooperation of local governments in France, the Netherlands, Britain, Canada and the United States, the political and administrative reorganisation that has occurred in countries that have applied the principles of NPM as a rule has increased the importance of cooperation among local authorities. There is no reason to believe that the reforms have had a different impact in Finland. One basic need for greater cooperation in Finland is caused by the lack of regional multi-purpose authorities to plan infrastructure and provide services. In this matter, Finland differs considerably from many other European countries, where counties and regional authorities take care of public services. Many regional level functions – such as public hospitals, upper secondary schools and adult education centres – are in Finland under the responsibility of municipalities. This explains why special-purpose cooperative organisations have a long history in Finnish local governance, and it is also an important reason that cooperation and amalgamation are increasingly under discussion now, when municipal tasks are increasing and resources are not in step. 4.3. Socio-demographic perspective Then there is also the socio-demographic perspective – migration (national and cross-border), an aging population and urbanisation are among the most important. Migration creates pressures for change both in peripheral rural areas and in well-todo urban areas. The bigger urban areas, e.g., Tampere, Oulu and Jyväskylä, have benefited over the past ten years from population and its respective job growth, particularly in the expanding information and communication technologies. By contrast, local governments in rural and peripheral areas have experienced decreases – sometimes alarming decreases – in population. Although the problems are basically different, both cases call for new strategies. In peripheral areas, a dwindling demand places services under severe pressure. Many problems may be incurred in maintaining an adequate level of services at reasonable cost for such small groups of citizens. In growing urban regions, the need to develop cooperation among municipalities may exceed any other. Extensive urban growth creates pressures of increased effectiveness regarding land use and planning, housing policy, and public transport; it also requires strengthening services for immigrant families. Growth management issues or problems usually transcend local administrative boundaries. The distribution of tasks, revenues and costs among local authorities may not be equitable. Cooperation may also be important in order to avoid the pitfalls of unrestricted competition. The need for cooperation is partly explained by the growing incongruity between the functional interdependence of core cities and surrounding areas on one hand, and disintegrated political and administrative structures within city regions on the other. The functions of city regions today are increasingly integrated. The built environment has expanded as a result of the dynamics of social and economic growth. The growing functionality can be defended, for example, by looking at the larger proportion of the workforce that is commuting to urban regions beyond the government area in which they live. As a rule, regional and local coordinating bodies or mechanisms should correspond to the functional city or region. Effectiveness

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or governance requires attention to whether regional organisations or processes exist to address and solve region-wide issues and problems (Savitch & Vogel 1996: 276). 5. An Overview of Cooperation in Finland Cooperative approaches have traditionally been special-purpose organisations or arrangements meant to provide certain services or address a specific problem shared by several municipalities. Examples are inter-municipal utility companies (water, electricity) and joint municipal boards for special hospitals (20 regions), for care of the disabled (15 regions) and for regional planning (19 regions). However, since the end of the 1980s there has been a considerable change in the intensity and scope of cooperation; it has widened to cater to new activities. Also new ways of organising cooperation have emerged and the traditional organisation models have been critically revised. Joint municipal authorities, which used to be very common in organising cooperation, especially in the health care sector, were criticised as being “spending automats” beyond the reach of local governments’ political control. This new wave of inter-municipal cooperation started with regional development projects, related especially to business or tourism. Many municipalities also established joint development organisations, made statements concerning important territorial issues to the central State government or other state organisations, or together employed civil servants to provide advisory and other services. This development was furthered when Finland joined the EU and adopted its structural policies. Since the end of the 1990s, municipalities have gradually started to focus on service cooperation in such core functions as education, basic health care and social services.2 Local government cooperation today includes a variety of functions and activities ranging from local economic development programmes and regional strategies to public transport, education, health, regional e-government and culture. The models of cooperation vary, depending on the cooperating municipalities, their specific problems and the functions involved. The models of cooperation differ in degree of institutionalisation, the scope of activities and organisational forms. A number of different organisational models are in use; some of them are traditional in the sense that they have been used for decades, while others are new, pilot-type models. The new arrangements sometimes include multi-purpose regional organisations, for example, in the form of a sub-regional council or company. Multi-purpose regional organisations are established to accelerate the development of cooperation, to secure the democratic control of numerous cooperatives, or to coordinate the numerous special-purpose bodies of the region. Another feature typical of the new cooperative arrangements is that the organisations are often more informal in nature than they used to be. As O’Toole (1997) has pointed out, networks are “structures of interdependence involving multiple organisations or parts thereof, where one unit is not merely the formal subordinate of the others in some larger hierarchical arrangement”. Networks are characterised by flat form, interdependence and informality rather than formality and common goals. The most typical form of network-style organisation is the interlocal agreement, in which two or more local governments enter into an agreement on a specific issue of inter-dependency. Another example is where knowledge and good

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practices are exchanged in informal consultative forums. Association is also a popular way to informally organise cooperation. Contract-based cooperation means that a local government pursues the production of services under contract with other local government(s). The contract can be written or oral. The most typical model is where a municipality offers to produce a certain service for the citizens of another municipality in exchange for payment or some counter-service. Contract-based cooperation is gaining in popularity because it seems to be practical, especially for occasional activities. It is also often used for the long term in cases where there is no need to establish heavy organisations to undertake the task or when there is a strong need to ensure services in smaller municipalities in the cooperative area. Today, more often, the arrangement of inter-municipal cooperation takes the form of sub-regional contract, sub-regional council or government. The sub-regional contract is new and currently used by 20–25 regions (e.g., Oulu, Nivala-Haapajärvi, Hämeenlinna), but it is expected to gain popularity in the coming years. A subregional contract is meant to provide political backing for multi-sector and long-term development of municipal cooperation in a regional context, and it may cover a broad range of services and other functions that are provided jointly. A subregional contract is not subject to referendum; instead, it is approved by each local government council. Sub-regional contracts usually include an agreement on the most important guidelines concerning development of cooperation: goals, issues and organisational arrangements of cooperation. A sub-regional strategy is a regional plan that can address economic development issues just as well as service provision. There are no standardised, formal approaches to planning the sub-regional strategy, but most labour-market regions have exercised some sort of strategic planning processes. The participants are local government officials and aldermen, and often also private and third-sector actors. A sub-regional council and sub-regional government form a multi-purpose regional body that provides a forum for inter-municipal cooperation and coordination. The council may have its own staff and budget, financed by member municipalities. The sub-regional councils are entirely voluntary; they have no power to levy taxes and no regulatory power. This model of authority is weakened by having no direct elections. The members of sub-regional councils have been elected by municipal councils. In mid-2005, there were no directly elected sub-regional councils in Finland, although one was planned for the Nivala-Haapajärvi sub-region. 6. Characteristics of Different Types of Emerging Cooperation Models 6.1. Governance experiment in the Kainuu Region The latest intervention concerning inter-municipal cooperation is the governance experiment in the Kainuu region, where 85,000 inhabitants live in an area about the size of Belgium. The Kainuu experiment received fixed-term legislation in 2004, which transferred certain tasks, traditionally the responsibility of municipalities, to the decision-making authority of a region. A number of reasons led to the initiation of the governance experiment in Kainuu: economically stressed municipalities, growing unemployment, declining

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entrepreneurial activity and a very challenging demographical development. As the population is declining, the older age groups are growing. The aim of the experiment is to: -

Ensure health care, social services and educational services for all regional inhabitants, Bring the guidance of business subsidies under one regional organisation, Better focus regional development activities, Initiate larger, more effective projects, and Create new enterprises and jobs.

The governance experiment concerns nine of the ten municipalities in the region of Kainuu. The nine municipalities formed a joint municipal authority responsible for upper secondary education, primary health care services, welfare for drug abusers, environmental health care, child welfare, child guidance and family counseling center and geriatric institutional care, special health needs and care of the mentally disabled. The region is also responsible for regional policy and economic development, regional planning and development, and allocating its share of EU structural funds. The joint municipal authority is financed by gathering about 60 percent (59.9 percent in 2005, to be precise) of each municipality’s calculated tax revenue. The idea is that by increasing the efficiency of services, the percentage of municipal income required for its support will decrease, such that in 2009 this percentage will be 58.6. The nine municipalities took part in the experiment voluntarily, but the gathering of resources (the formation of the joint municipal authority) was clearly defined by law. The law termed it a “mandatory joint municipal authority” and stated that “all the municipalities involved in the experiment are to take part in it”. The municipalities established the regional authority themselves knowing that if they were not able to make the arrangements, other actors would. The law is set to be in force until 2012, prior to which the municipalities are forbidden to take back the tasks and competencies transferred to the regional authority. Decision-making authority of the region is in the hands of a council elected directly by the residents. The council has 39 members and appoints the executive board and manager for the region. One-third of the total employees that worked for the municipalities now work for the joint authority, and were transferred as experienced employees with the same benefits they had previously. The organisation has 3,500 employees. This reform so remarkably diminishes the tasks of the municipalities that it is necessary to reorganise municipal decision-making organisations. The experiment is remarkable in Finland, which has active discussions concerning the economic situation of the municipalities and the possibility of granting to others the services mandated for their residents. Thus far, however, it seems that voluntary inter-municipal cooperation has not been a success; it might be that this kind of strong legislation is needed in those areas actively pursuing a significant change in municipal services. It is interesting that, with very different perceptions, the Kainuu experiment is seen as a way to develop local government in Finland. Some think that the experiment is a prelude to amalgamation of municipalities, where others think the

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experiment makes it unnecessary to create larger units of local government in the region; some think the experiment is a way of limiting the autonomy of municipalities which represent the each area’s inhabitants, while others believe that the experiment is actually a way of increasing democracy in the region. 6.2. Models found in the experiment on sub-regional cooperation At the end of 2000, the Ministry of the Interior launched a project (with the acronym of SEUTU) to enhance voluntary cooperation and to strengthen sub-regional development in Finland. The project involves special fixed-term legislation, some financial support for the sub-regions, evaluation of the experiments, and the diffusion of best practices. The aim of this fixed-term legislation is to organise experimental cooperation among municipalities to gain experience on voluntary inter-municipal cooperation and its possibilities in securing the quality and availability of public services in the challenging and changing environment of Finnish municipalities. This includes improving the conditions of business life, developing community structure, strengthening municipal autonomy and decentralising decision making. At the outset of the project, the law was applied in eight pilot sub-regions, but was later expanded by an additional seven sub-regions. The main reform approved by the law was giving the opportunity to form an organisation subject to public or private law that can use decision-making power on behalf of the member municipalities. Although it has been possible to form different types of common organisations on the grounds of other legislation, there have been difficulties in reaching genuine inter-municipal decision-making. In many cases, the actual decision-making power has stayed in municipalities and, as result, the functions of inter-municipal organisation have suffered from slow and unreliable decision making. The law offers the possibility of assigning tasks to an inter-municipal organisation comprising representatives of municipalities; every member municipality must have representation. How the representatives are chosen is the decision of the member municipality. The tasks assigned to this organisation are subject to public or private law. The organisation is different in that it is not a part of an organisation of some member municipality, as was the case in previous organisations (77§ of Finnish Local Government Act). This new form of organisation is, from a juridical point of view, powerful enough to decide on service delivery and common resources. That does not make the law something revolutionary, because Finnish legislation concerning inter-municipal cooperation has always been more permissive than restrictive. Thus far the experiments approved by this law have not been very far-reaching and it seems that the problem lies and has always lain somewhere beyond the institutional structures. The characteristics of different types of coordination are based on the experiences of eight sub-regions participating in the SEUTU project. The University of Tampere was commissioned to conduct an independent evaluation of the project; some of those results are presented here. The evaluation was carried out in three phases. The first was completed in 2002 (Airaksinen & Haveri 2002) and its goal was to evaluate the frame of the administrative reform according to the situation, challenges and environment of Finnish

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municipalities. The goal of the second phase, completed in April 2004, was to produce information on how inter-municipal cooperation has developed in different situations and in different sub-regions, what forms of cooperation have been discovered and how the intensified cooperation is experienced in different sub-regions. The third and last phase of the evaluation was finished in December 2005, drawing conclusions on the results and outcomes of the project. The evaluation report was published as a book by Tampere University Press (Airaksinen, Nyholm & Haveri 2004). The material used for the evaluation consisted of the following components: 1. 2.

3.

4.

Material produced by the sub-regions, their applications for the project, various strategy documents, plans and cooperation agreements. Interview material collected in the sub-regions and the researchers’ observations made during visits to sub-regions. Interview material was collected in October-November 2003. A total of 90 (10 to 12 from each eight sub-regions) persons were interviewed. The interviewees were municipal managers, people in positions of trust, sub-region coordinators and municipal officials working in specific sectors. Responses to a barometer-type survey. This was directed at holders of leading positions of trust and the leading officials within municipalities and inter-municipal cooperation organisations carried out at the end of 2003 and the beginning of 2005. Surveys had the same content so that the changes in attitudes and opinions could be detectable. In 2003, 477 people responded, roughly 70 percent of the target group; in 2005, 445 responded, about 65 percent of the target group. The survey included questions on the need for sub-regional cooperation, drawing up goals, implementation of the goals and the roles of different various sub-regional organisations in implementing the goals. In addition to that were questions on the hindrances and facilitating elements affecting inter-municipal cooperation. Other surveys on various themes. For example: a survey of personnel of new inter-municipal organisations about the effects of inter-municipal changes and a survey directed to key decision-makers of municipalities about the time-resource they use in inter-municipal cooperation.

To throw light on the characteristics of different types of cooperation, the eight pilot sub-regions were divided into five groups on the basis of characteristics of the different sub-regions, the depth of their organisational form and the aims and significance of the cooperation. The characteristics of the urban hierarchies. The first category comprises the two sub-regions, Hämeenlinna and Lahti, both of which are rather compact and urban (on a Finnish scale) with a relatively strong central town. Their aims of cooperation were quite ambitious; the structures of cooperation were stronger and more hierarchical than in other sub-regions. The organisational forms in the compact urban sub-regions category were identical. Administratively they resembled joint municipal authorities, although in Hämeenlinna the organisation itself was subject to private law which is a new form of inter-municipal cooperation in Finland. The organisation itself in both sub-regions was quite large with a structure of council, executive board, working committee and

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sub-regional office. The reason for establishing such large organisations was similar in both sub-regions: Their goals were ambitious in assigning service-related tasks to an inter-municipal organisation. The autonomy of this kind of institution in relation to the local governments was greater than in other forms of cooperation, because it was not necessary to consult individual municipalities when making decisions. In both sub-regions the cooperative organ is responsible for actual service provision. In Hämeenlinna the inter-municipal body and its employees were responsible for producing services of financial administration and payroll administration for the municipalities and other joint municipal authorities in the region. The aim of the inter-municipal arrangement was to cut costs up to 20 percent and eliminate overlapping. One unified office in Hämeenlinna has about 45 personnel in the procurement unit, and a turnover of about €2.3 million. In the Lahti sub-region, the inter-municipal public utility has been providing infrastructural services for the municipalities since early 2005. The 180 workers were transferred to work for the public company, the turnover of which is €22 million per year. The municipalities are steering the functions by defining quality standards for the services and by financing the operations. The inter-municipal organisation has a special infrastructure board to ensure the fulfillment of the goals set by the sub-regional council. Theoretically, this kind of inter-municipal cooperation comes close to hierarchy. When municipalities establish a permanent, multi-functional common organisation to take care of tasks and give it decision-making power (capacity, resources, staff) to implement policies and provide services, processes can be quite straightforward and decision making quick, because the organisation is able to function without special permission from cooperating municipalities. To ensure politically strong and reliable decision making in the sub-region, all political groups and all municipalities have to be represented in the organs of inter-municipal organisations. These organs were created because the ambitious goals in both the sub-regions indicated that large amounts of local government tasks would be transferred to the inter-municipal bodies in the near future. The greatest problem that has now arisen is that these “strong” organisations have not achieved the sufficient power that was planned. The result is that these politically wellrepresented and large organisations are lacking meaningful tasks, a situation that creates frustration and negative attitudes towards inter-municipal cooperation. This is paradoxical, because the same municipalities that created these organs have not been willing to assign tasks to them. Another feature that affects inter-municipal cooperation in these urban sub-regions is their ambivalent attitudes towards the center town. On one hand, it is commonly accepted that the well being of the center is the well being of the surrounding sub-region. On the other hand, there is an implicit and sometimes explicit fear of the concentration of development in the center, causing the fringe areas to atrophy. In Lahti, as in many other cases, it is impossible to evaluate the performance of this new inter-municipal public company with only six months of service. Yet, the municipalities expect a 3 percent growth in efficiency every year. The biggest achievements in the sub-region of Lahti are in the field of the culture of local government politics. Every time there are discussions on the development of services, the alternative of inter-municipal cooperation is taken into account. Also the new organisation, bringing politicians and municipal clerks from different municipalities together, has created a structure and a platform for development discussions.

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The characteristics of urban networks. The network type organised sub-region of Oulu forms the second category. Geographically the Oulu sub-region belongs to the same category as Hämeenlinna and Lahti but its organisational form and principles in organising inter-municipal cooperation are different. With a network-type of organisation in inter-municipal cooperation we refer to one that has no single overarching authority, but where the intended action has to be approved by every party in the network. This seems to be the idea behind the intermunicipal organisation of the Oulu sub-region. The most important features include basic principles of both interdependency and independent authority of every municipality engaged in cooperation on the basis of mutual benefit. The fluidity of the Oulu network model can be seen in the fact that it is not a fixed structure but one that is able to change on the basis of the task in question. The cooperative organisation includes a sub-regional council consisting of municipal politicians, and a sub-regional government comprising municipal managers, a development team as a coordinating organ and a flexible structure of project teams, and work groups that are set up when needed. The municipalities are well represented by their officials. In issues that concern services or require more resources, the actual decisions are made in municipalities by their own councils and executive boards. This means that, in practice, the power of the sub-regional council is very limited and serves only as a forum for information exchange and planning. In the Oulu sub-region, the independence and decision making of municipalities is highly respected and municipalities are key actors in the implementation process. Actions are taken via negotiations between partners. The process of decision making involves quite a bit of horizontal coordination and preparation, which means that it is possible for the transaction costs to outweigh the results gained in the actual process. This approach ensures commitment but takes time, and it seems that in the Oulu sub-region the networkbased work seems to be on the level of composing new ways of taking care of services in the sub-region rather than providing them. In the Oulu sub-region, the attitudes towards the strong center are not merely positive; the network-based approach seems to work pretty well in eliminating the strongest fears and prejudices concerning the center city and its development at the expense of the surrounding area. Now, when cooperation is approaching the services of municipalities, attitudes towards the center town are becoming more critical. The formulation of strategies of cooperation is completed and now the sub-region of Oulu is facing the challenge of implementing these strategies. The greatest fear in the sub-region is that those strategies, which have taken much time and effort, will not affect the services in practice and instead remain as pleasing but hollow rhetoric. The main reason behind this fear is that, unlike many other municipalities in Finland, the municipalities of the Oulu region are not in a severe economical crisis. The characteristics of functionally and geographically fragmented sub-regions. The third category consists of three sub-regions: North Lapland, Loimaa and Turunmaa, which are functionally and geographically fragmented, although for different reasons. A fragmented structure is the common feature. North Lapland is a sub-region where distances are long: the distance from its southernmost to northernmost point is 420 kilometers, more than from Helsinki to Stockholm. The population density is the sparsest in Finland, only 0.5 people per square kilometer. This means that if the population were scattered evenly, the nearest neighbor would be 1.6 kilometers

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away. In Loimaa, the distances do not approach those of Lapland but the road net-work is not very extensive. The roads divide the sub-region into three functional parts, which makes it difficult to cooperate in the whole sub-region. Turunmaa archipelago, with its thousands of small islands and rocky islets, is unique and creates a challenging environment for inter-municipal cooperation. Depending on the weather conditions it can be extremely hard to get from place to place, so municipal services must be planned with this in mind. In these sub-regions the possibilities of information technology are emphasised in creating new ways of cooperation. In Loimaa, this has produced a virtual place for searching for substitutes and expertise needed in the sub-region. In Turunmaa they have a sub-regional broadband network which facilitates cooperation in health care making it possible to send x-rays electronically to be interpreted elsewhere. Turunmaa also has a citizen network, which functions as a virtual community by being a channel for information and discussion. Focusing on information technology naturally means that the most expensive – and also in a way the most important basic services, for instance those in health and child care – does not have a center of inter-municipal cooperation. Instead, the focus of developing inter-municipal cooperation is in the area of local economic development, the common development of the sub-region, and lobbying. One feature that is common to all three sub-regions is that the tasks involved in nter-municipal cooperation are clearly defined and stated. In these sub-regions, inter-municipal cooperation is labeled with a relatively realistic view on the limited possibilities of cooperation in services. This means that, in practice, no remarkable economical resolutions are found via inter-municipal cooperation. The characteristics of a bipolar sub-region. The fourth category is the sub-region of Nivala-Haapajärvi, which is different from the previous ones because it has a bipolar structure. The sub-region has two relatively strong towns: Nivala, which is the largest, and Haapajärvi, which is in the middle of the sub-region. In the sub-region of Nivala-Haapajärvi, the feature that makes it different from the other sub-regions is that it does not have a commonly accepted central town. This is evident even in the sub-region’s name. Nivala is population-densest but Haapajärvi is geographically in the center. This brings more challenges to the development of inter-municipal cooperation. Nivala-Haapajärvi had an ambitious plan to select a council for the sub-region by a direct election in 2004, and this discussion led to a new legislation. Obviously that schedule was too optimistic and the plan was put on hold. This case demonstrates a basic dynamic of Finnish inter-municipal cooperation: At the discussion level, they seem ready to make remarkable decisions but the closer the actual decision making, the more critical and indecisive they become. At the moment there is only one new inter-municipal organisation, the development center, which appeals to all municipalities. It was launched January 2005, and takes care of business environment services. Much work is done in the sub-region in researching and evaluating different inter-municipal opportunities in services. The biggest problem is that they have not been able to find the kind of operational structures for producing the services that would satisfy the municipalities. Presently they are trying to develop a responsibility-municipality model, where one municipality takes care of certain tasks on behalf of all five municipalities of the sub-region. Each municipality could then concentrate and develop special expertise on a particular task.

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The characteristics of an amalgamated sub-region. The sub-region of Pieksämäki forms the fifth and last category, an amalgamated sub-region. Three municipalities were merged into one in 2003-2004, leaving the region with four rather than six municipalities. In early 2005 the situation was changed again, when two municipalities left the association to cooperate with others outside the original regions. Thus, since the beginning of 2005, the sub-region has consisted of two municipalities. An amalgamation of these two municipalities is expected in the near future and the subregion will in fact be one municipality. This has dramatically diminished the need for inter-municipal cooperation; the basic reason for cooperation between the two remaining municipalities is to facilitate the future amalgamation by rationalising the structure of the production of services. Discussion on performance. Because most of the new organisations have not functioned long enough to be evaluated properly, we present an empirically-based broad description on performance from different points of view. For a more detailed example of performance, we use the inter-municipal organisation of financial and payroll administration of the Hämeenlinna sub-region. Effects on economical efficiency. In the economical situation of Finnish municipalities, cost savings have been one of the most important reasons to increase inter-municipal cooperation. Measuring this is problematic when costs increase due to the actual quality or availability of services. In that case, the economical efficiency of the services should be evaluated according to the effects on the inhabitants in the long run. The municipalities are impatient to see cost savings, which is understandable in a time of insufficient resources. Sometimes cost savings are not realised because even if the new organisation is created, the old organisations are still working and alive. “We [the politicians of the municipalities] expect cost savings immediately but at same time we have accepted the principle that due to inter-municipal cooperation nobody will get fired. I know that in this kind of situation it is very difficult to show cost savings, at least in the beginning, because we use the same number of personnel to produce the intermunicipal service…” Even when cost savings are about to be realised, they are not easy to calculate and verify; at the same time, politicians often demand objective and accurate information about the economical effects of proposed inter-municipal arrangements. This difficulty of proving cost savings seems to be one of the reasons that inter-municipal cooperation is getting slower and more difficult as it moves on to the most important sectors of municipalities. The biggest contradiction lies in the situation where cost savings are demanded and at the same time the municipalities are not ready to experiment with inter-municipal solutions in the most economically important services. The municipalities clearly understand this contradiction, but have not resolved it. “If we want to increase the productivity of the municipal system by enhancing inter-municipal cooperation, it is not enough to rearrange some minor functions… Small solutions just don´t solve our problems. In complex solutions we have to accept the situation that somebody will get hurt and not everybody will get everything.” In our example organisation, one goal for the inter-municipal financial and payroll administration unit was to reduce costs (in software and other information technology inputs and administrative staff expenses) up to 20 percent by the year

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2004. When these services were provided by the municipalities in 2000, costs were €3.483 million. The costs of the new system were €2.781 million in 2003, already showing a 20.2 percent reduction. Effects on municipal personnel. There are only few cases where effects on municipal personnel can be evaluated. One of them is the sub-regional organisation of Hämeenlinna, where the majority of the staff of the financial and payroll administration was relocated to an inter-municipal organisation. Originally 70-75 employees were needed to take care of these functions in municipalities; after the change, the personnel needed were approximately 40. Another similar organisation is functioning in the Lahti sub-region. According to a survey carried out in both organisations in 2004, the change affected the everyday life of both organisations’ personnel. Of the respondents (N=39, 58 percent of the sample), 72 percent experienced a change in salary, 62 percent experienced a change in commuting and 26 percent experienced a change in working hours. The effects of the organisational change on actual work were considered mostly positive from the point of view of employees (Figure 3). The changes improved the content of the work, and the working processes are now considered to be easier and more functional. It also enabled investments in new technology which would have been far too expensive for individual municipalities. The problems posed by the reform – software problems, inadequate flow of information and management – were mostly related to the management of change. (For a more detailed description of the results, see Vallo 2004.) Figure 3: Effects of increased inter-municipal cooperation on the content of work from the point of view of the personnel The content of work

I am content with the new challenges I

63,2

face due to the change

7,9

28,9

With the change I have better 18,4

50

possibilities to personal growth and

31,6

Agree

career development

Can´t say

The change has improved my 55,3

possibilities to use my skills in

Disagree

18,4

26,3

23,7

23,7

versatile ways The change has improved my possibilities to utilize my knowhow

52,6

and my skills in my work 0%

20 %

40 %

60 %

80 %

100 %

The majority of respondents had a positive attitude towards inter-municipal cooperation after the actual transition process (Figure 4). After resolving problems

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of the initial phase (problems with the software and technology), most respondents thought that the new system was better than the old one, that inter-municipal cooperation was an important strategy for the future, and that it was a possible way to enhance the productivity of municipalities. Figure 4: Attitude towards inter-municipal cooperation after an organisational change from the point of view of the personnel

Attitudes towards inter-municipal cooperation

The new system is better thant the old

23,1

43,6

one

33,4

Agree

Inter-municipal cooperation enhances

20,5

38,5

41

the productivity of municipalities

Can´t say Disagree

Inter-municipal cooperation is

28,2

64,1

necessary in the future

0%

20 %

40 %

60 %

7,7

80 % 100 %

Effects on the municipal cultures. In inter-municipal decision making, the biggest problem can be seen in the inappropriate relationship between the inter-municipal structures and their decision-making power. When establishing new inter-municipal decision-making organs, the reality that municipalities are not willing to cede power is often ignored. This can lead to a situation where the inter-municipal organs are too heavily built relative to their tasks. In all the regions where a democratic and thus strong organisation was pursued, the result seemed to be an over-organised and underemployed body which, in the worst situation, leads to frustration among politicians and municipal clerks. Again an interesting contradiction is found: In the interviews the sub-regional councils were criticised and their necessity was questioned, but the results of the survey painted a different picture. According to the survey the municipal council was not considered to work well but was still seen as a necessary organ in inter-municipal cooperation (Figure 5). Another interesting feature concerning inter-municipal decision making is that when cooperation increases, the significance of a municipal manager increases in relation to the elected municipal politicians. The survey also shows this: As municipal managers think their influence on inter-municipal issues has grown, the critical assessment of their activities is also growing (Figures 6 and 7).

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Figure 5: Opinions considering the necessity and functionality of inter-municipal council in 2003 and 2005: n=922

Figure 6: Opinions of different groups on their influence over inter-municipal decision-making in 2003 and 2005 ( n=922)

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Figure 7: Opinions on the municipal managers and their performance in intermunicipal cooperation in 2003 and 2005. n=922

The most significant changes in the culture of municipalities can be seen at the discussion level of inter-municipal cooperation. Attitudes and culture have changed in two rather different ways. On one hand, discussion on inter-municipal cooperation is a part of the everyday work of the central politicians and clerks of municipalities, and it has clearly enlarged in the views of municipal actors. On the other hand, in recent years, the level of the discussion has in many sub-regions become more realistic and less rhetorical, which means that also critical views on cooperation are arising. At the beginning of the SEUTU project in 2001, the inter-municipal rhetoric was the gospel according to the central government and the local level. Both defenders and opponents of amalgamations spoke of inter-municipal cooperation as a strategy for accomplishing their goals. This seems to be the biggest stumbling block of inter-municipal cooperation in Finland. When the phenomenon of intermunicipal cooperation is not clearly defined, its development takes place in a sort of vacuum of rhetoric. All seems well until implementation of decisions is imminent. At that moment, opinions suddenly change and commitment disappears. 7. The Future of Inter-municipal Cooperation The future of local government in Finland is at a crossroads. The situation of local governments is characterised by overload, and there is a clear need to combine resources to be better able to provide services and take care of local economic development. This seems to be well understood by local government decision makers: There is a readiness to deepen cooperation considerably and joint organisations are considered necessary. In practice, however, considerable problems in the advancement of cooperation emerge, especially when it comes to the “core services” mentioned above: health care, social services and education. Decisions on

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inter-municipal arrangement of functions often fail just before the finish line, when the municipality has to cede control of some service an inter-municipal body (see Haveri 2006). In the next pages, we assess the future development of inter-municipal cooperation based on two recent studies. In the first, Haveri, Laamanen and Majoinen (2003) analysed the views of local government actors and experts on the needs to change local government structure and boundaries in the future.3 The study, which used the Delphi method, concluded that the debate on local government structure in Finland is not so much between consolidationists (those who want amalgamations and a decrease in the number of municipalities) and those who support small-sized local authorities; instead, it is a debate between supporters of amalgamation and supporters of increasing cooperation. Opponents of amalgamations acknowledge the importance of size, but prefer cooperation rather than amalgamation because cooperation does not pose a threat to local identity and the existence of current local governments. According to the panellists of the study, the number of municipalities should clearly be smaller in the future. The hope is that by 2017, the total number of municipalities will be under 300; it is now 440. To ascertain the panellists’ views on the future development of local government, three alternative scenarios were presented them: a self-sustaining municipality, a network municipality, and a municipality based on identity. The self-sustaining municipality corresponds to the traditional Finnish system of local government, which seems to be possible in the future only through radical change of local government structure, meaning extensive amalgamations. A network municipality is a self-governing community responsible for a vast range of services, but they are provided in cooperation with other local authorities, or they are organised through contracting with other public sector actors, private providers or non-profit organisations. In the identity municipality, local authorities play a minor role in service production but they are characterised by a strong sense of community and local identity. Although the network municipality – increasing inter-municipal cooperation as a core factor – is seen as the most probable model of local government in the near future, the self-sustaining municipality is still the more popular option. This argument stems from the clarity of the model and reflects various suspicions concerning the network municipality, mainly dealing with the expected side-effects of the increasing intermunicipal cooperation. The legitimacy and accountability of the network model is seen to be especially problematic. According to opinions quoted from the Delphi survey, the network municipality presents the risk that clear and transparent government is lost in a haze of numerous special-purpose organisations, committees, agencies and boards. The study also compared the panellists’ views on municipal mergers and cooperation as strategic alternatives. By 2007, the relative importance of municipal mergers will be at least 30 percent and that of municipal cooperation about 70 percent. In the longer term, municipal mergers as a strategic choice will grow in importance. The panellists based their future evaluation on the idea that the network model is a more realistic option both politically and economically, whereas amalgamations are difficult to realise. However, according to the evaluation results of Airaksinen, Nyholm and Haveri (2004), inter-municipal cooperation also seems to proceed sluggishly. In most cases, concrete decisions on expanding cooperation had not been reached in the sub-regions under evaluation and there is a wide gap between intentions expressed at discussion level and actual decision making.

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There are many explanations behind the problems of cooperation. One is the general resistance to change that occurs in human nature. Path dependency is another. According to Haveri (2006), uncertainty in decision-making situations seems to be the key explanatory factor in the current situation of the Finnish local governance. Decisions are held pending the certainty of their grounds. Uncertainty is closely connected to the complexity of decision-making situations and means that various actors (individuals, political and other such groups, municipalities) are not sure, or are very doubtful, of what they should do and what the right decisions are. It also turns out that rational analyses and expert knowledge do not provide adequate information and certainty to support decision making. Instead, expanding inter-municipal cooperation in core services requires decisions to be made on political grounds rather than on the basis of rational analysis. The critical factor in the advancement of inter-municipal cooperation is to find political consensus and political leadership within the local actors’ network. In the end, the decision-making ability in inter-municipal affairs depends on the emergence of political leaders willing and able to take responsibility for reforms. To conclude, what is the future of local governance in Finland and what role does inter-municipal cooperation have in it? There is a ground-level acknowledgment that local governments in Finland cannot continue with the current mode of governance. Many new ways of governance are needed to secure their ability to provide services and take care of local economic development. Beyond this, the situation is complex. On one hand, cooperation has increased considerably in some activities; municipalities have established joint organisations; and the attitudes towards deepening cooperation are positive. On the other hand, the advancement of cooperation is sluggish in the most important services: health care, social services and education. It seems that municipalities are unwilling to set up strong joint authorities because they are afraid of losing control over the execution of a range of public services they consider vital for municipal autonomy. To overcome this problem, there is a need for strong political leadership. Our prediction is that cooperation – in particular, voluntary cooperation – taking place on the basis of local strategic choice will not be the major “cure” for the local government crisis in Finland. It has worked and will work in many new or “light” services such as counselling services, regional development and local economic development, but when it comes to important structural change in key services, decisions are far too slow and cooperation is unpredictable. Some city regions may succeed; it is possible that in these cases increasing cooperation will eventually lead to the institutionalisation of new regions. In most cases, however, the Finnish government will be forced to take a more active role in guiding the development, and that is precisely what it is planning to do. As this article is being published, the Finnish government is implementing a project to restructure municipalities and services. Its objective is to achieve a situation where all services that municipalities are currently responsible for have a sound structural and financial basis. The term of the project is 11 May 2005 to 31 May 2006.4 The tasks of the project are to:5 •

Evaluate and submit a proposal for the appropriate areas of responsibility for the statutory and other services assumed by the municipalities with due regard to the content and specific features of such services, including their

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• • • • •

availability, standard of quality and the long term financial resources of the municipalities, as well as regional and language-related special features; Evaluate the restructuring of municipalities and cooperation across municipal boundaries at all regional levels up to the national level; Analyse and promote best practices for the organisation and production of various services; Evaluate the steering and development systems for the production of services and related research and prepare proposals for further improvements; Evaluate the division of duties and allocation of costs between the central government and municipalities and prepare the necessary proposals; and Prepare the normative and legal changes related to the organisation and provision of services necessary for the implementation of the project.

The task of the government is not easy, taking into account the many political tensions involved in this issue. The planned reform is a game of winners and losers and thus an issue that is highly charged. One problem – which does not lighten the task – is that the major parties in the current government have quite conflicting policies concerning the position and role of the local government. References Airaksinen, J., Nyholm, I. & Haveri, A. (2004). Seutuyhteistyön arki, retoriikkaa, politiikkaa ja raakaa työtä. Kunnallistutkimuksia. Tampere: TUP. Airaksinen, J., Haveri, A., & Vallo, M. (2005). Seutuyhteistyön tilinpäätös. Seutukuntien tuki- hankkeen loppuarvio. Tampere: TUP. Haveri, A., Laamanen, E., & Majoinen, K. (2003). Is local government structure undergoing change? A study of the future need to redraw the local government map. Acta Publications, 155. Helsinki: The Association of Finnish Local and Regional Authorities. Haveri, A. (2006). Complexity in local governance change. Limits to rational reforming. Public Management Review, 8(1). Kivelä, S., & Mannermaa, M. (1999). Kuntien tulevaisuus. Kunta-alan tulevaisuusbarometri 1999. Suomen Kuntaliitto. Acta-tutkimussarja 102. Helsinki. O’Toole, L. (1997). Treating networks seriously: Practical and research-based agendas in public administration. Public Administration Review, 57(1): 45-52. Savitch, H.V. & Vogel, R. K. (1996). Regional Politics. America in a post-city age. Urban Affairs Annual Reviews 45. SAGE. Vallo, M. (2004). Seutuyhteistyön vaikutukset kuntien henkilöstön työmotivaatioon. Tapaustutkimus Päijät-Tilin ja TAHTO-hankkeen henkilöstön suhtautumisesta seudullisiin organisaatiouudistuksiin. Tampereen Yliopisto. Kunnallistieteiden laitos. Tampere. Laws and regulations: Suomen perustuslaki (731/1999). Laki seutuyhteistyökokeilusta (560/2002). Alueiden kehittämislaki (602/2002). Laki Kainuun hallintokokeilusta (343/2003). Euroopan Neuvoston paikallisen itsehallinnon peruskirja (SopS 66/1991). Laki pääkaupunkiseudun yhteistyövaltuuskunnasta (1296/1996).

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Notes 1

The main features of this study are described in section 6.2. These three areas are considered to form the “hard core” of local government services in Finland 3 The study was conducted by the Association of Finnish Local and Regional Authorities in 2002-2003 and concerned the development of Finland’s future municipal structure. The resulting report (Haveri, Laamanen, & Majoinen 2003) brings out three different scenarios of the direction in which municipalities will develop. 4 As of early May 2006, the proposals of this project remain incomplete. 5 http://www.intermin.fi/intermin/hankkeet/paras/home.nsf/pages/indexeng 2

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CHAPTER 4 KAREN WEST

INTER-MUNICIPAL COOPERATION IN FRANCE: INCENTIVES, INSTRUMENTALITY AND EMPTY SHELLS

1.

Introduction: The Complex Institutional and Political Context

France has essentially three territorial layers of administration: the region, the department and the municipality (commune). There are two types of administration for each of these geographical entities: the deconcentrated State services, which implement central State policy and act under the supervision of the Prefect; and the decentralised, representative political institutions, or local authorities. All are elected by direct universal suffrage. The municipality has responsibility for all municipal services, land use and planning, and building permits. The department’s responsibilities are in the areas of health and social services, construction and maintenance of public highways, and school bus transportation. The region’s responsibilities are in the area of regional economic planning, industrial development and professional education. These functions have been modified somewhat with further decentralisation laws introduced in 2003. Debates about which of the elected territorial institutions is most suited to territorial administration and representation within the context of urbanisation, Europeanisation and globalisation have intensified in recent years. In broad terms, traditionalists, supported by the French Senate (which is dominated by mayors of rural municipalities and departments) support traditional institutions, i.e., the municipality and the department. Modernisers, conversely, favour a strengthened Region and the abolition of the department and direct universal suffrage for intermunicipal communities. It is within this context that the development of inter-municipal cooperation must be understood, paying particular attention to the question of why so many are reluctant to alter the centuries-old institutional status quo. Closer analysis of the institution of the municipality is, therefore, merited. R. Hulst and A. van Montfort (eds.), Inter-Municipal Cooperation in Europe, 67–90. © 2007 Springer.

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1.1. The municipality The municipalities and the departments are the oldest territorial institutions, both created during the Revolution. Until the 1980s decentralisation laws, the municipalities enjoyed greater political autonomy than the departments. Formed during the revolution to cement local identity (Mabileau 1994), the municipalities have had what Blanc and Rémond (1994) describe as “a long march” towards decentralisation, slowly wresting power from the central State. Since the Revolution, they have exercised a dual function: State agent and representative of the municipality, although the balance between these two functions has altered over time. During the Consulate and the Empire, Napoleon increased the centralisation of the municipalities through the establishment of the departmental Prefect (Schmidt 1990). The Prefect became henceforth the departmental executive, who either chose or nominated the mayor and deputy mayor from within the municipal council depending on the size of the municipality (Schmidt 1990). The notion of tutelle, the power to control all decisions made by the municipalities, was established during this period. Since that time, the municipalities have slowly gained autonomy from the central State through (1) direct mayoral elections, (2) the right to create direct service organisations (régies municipales) (Blanc and Rémond 1994), and (3) the lifting of prefectoral tutelle in 1982 for all decisions made by the municipal council in favour of a much weaker a posteriori control of legality along with the transfer of other central State functions. In light of this hard-won power – which many would argue still falls far short of that desired (Schmidt 1990) – is an understandably strong reluctance to engage in any form of restructuring, much less cede political power to the new inter-municipal communities. The boundaries of municipalities were essentially those of the rural parishes and urban franchises under the ancien régime (Mabileau 1994). Given the strong significance of the municipality as the unit of government closest to the people, their number has not significantly responded to the two legislative initiatives in 1959 and 1971, which reduced them from 38,000 to 36,394. Following several de-mergers in the 1980s, they now number about 36,500. Despite their enormous variation in size – 3,000 municipalities have fewer than 1,000 inhabitants and five more than 300,000 (Ministère de l’intérieur 2005) – each municipality enjoys the same status and has the same structure, that is, a municipal council and mayor, both elected every five years. The idea that municipal power can only be legitimated by direct election is a principle established by the 1789 constitutional assembly (Blanc & Rémond 1994) and no doubt explains why the voting French public see the municipality as the cornerstone of French democracy. 1.2. Inter-municipal cooperation To overcome the considerable deficiencies of scale at the municipal level, the municipalities have, on a voluntary basis, cooperated with other municipalities to organise and deliver the services for which they are responsible. Various institutions for intermunicipal cooperation endorsed in administrative law have been available to the municipalities since the late 19th century, although there have been important changes to

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those structures in recent years. This will be discussed at length further in this chapter. Inter-municipal organisations have never supplanted the sovereignty of the municipality, but act merely as agents to the municipalities, and are thus classified as public agencies rather than local authorities. Although in recent years the remit of inter-municipal institutions has, as a matter of policy, been extended to strategic decision making around urban planning and economic development as well as the more traditional role of service delivery, representatives of inter-municipal institutions are still not directly elected, but rather appointed from the municipal councils. 1.3. Decentralisation The logic of the landmark decentralisation reforms of the 1980s was functional rather than political. Each territorial level of government was to be equally decentralised (Blanc & Rémond 1994) through the transfer of State functions to the appropriate local level. Aside from laying the foundations for a directly elected Region, no attempt was made at political restructuring; relationships between municipality, department and region remained horizontal and regulatory power remained with the central State. When Raffarin came to power in 2002 determined to further decentralisation legislation, the political climate was against fundamental territorial institutional restructuring (Lidec 2003), but very much in favour of the maintenance of the status quo. Indeed, some have argued that the latest draft of decentralisation measures, collectively known as Decentralisation Act II,1 actually serve to reinforce institutional conservatism (Caillosse 2003, Rémond 2003). The same functional logic of the 1980s is very much in evidence in the latest reforms, which continue the transfer of responsibilities from the State to the municipalities, departments and regions. On the other hand, some important innovations in the latest reforms may, over time, provide the impetus to more fundamental change. First, the region is now constitutionally recognised as a local authority alongside the municipality and the department, and important new principles such as the temporary delegation of responsibility and the right to derogate from State regulation in adapting public services to local circumstances, it has been argued, could presage further, genuine decentralisation. Second, and more germane to the subject of this chapter, the new inter-municipal communities are, in some senses, regarded as the fourth administrative layer in the domain of economic development and spatial planning, although there is still no question of them gaining independent political power. 1.4. Summarising the context It is in this context that inter-municipal cooperation must be understood. It has acted as institutional “sticking plaster” in a country where any substantial territorial administrative restructuring is politically hazardous. Successive decentralisation reforms, while increasingly transferring executive responsibility for public policy to the various branches of local government, have preserved France’s traditional administrative architecture: relatively strong municipality and department, weaker region and inter-municipal organisation. Paradoxically, while the old and new inter-municipal organisations have served to prop up the much-prized political institution of the municipality (as the latter takes on functions of greater strategic importance), calls for

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their representatives to be directly elected have mounted. So far the structure of political power in the Senate has blocked progress towards direct elections. 2. The Basic Principles of Inter-municipal Cooperation The forms and purposes of inter-municipal organisations (known as public establishments for intercommunal cooperation2) have changed markedly over the years, as have the impulsions and incentives for joining them. Nevertheless some basic principles are common to all types, and they flow from the overarching principle of management autonomy for the municipalities and voluntary membership in intermunicipal organisations, which, in view of the direction of recent decentralisation reforms, are unlikely to alter in the foreseeable future. Municipalities form or join inter-municipal organisations voluntarily and only on demonstration of the will of the municipal council, although rules concerning voting on adhesion and secession have changed over time. 2.1. Indirect representation and delegation Inter-municipal organisations are not directly elected. In 1966 there was a move for the Communautés Urbaines to have direct elections, but this was rejected by parliament. The issue was raised again in the 1970s with the Guichard report, but was similarly rejected. In 2002, a further move towards legislating direct elections was voted down by the Senate. With 73 percent of the population now living in areas having an inter-municipal community with its own fiscal resources (AMF 2002), it is unlikely that calls for direct elections will go away. Each inter-municipal organisation has instead a council of representatives, elected by the member municipal councils, and an executive bureau made up of a president, vice-presidents and a number of members of the council of representatives. One of the functions of the council of representatives is to agree on the annual budget. Inter-municipal organisations are financially autonomous, although one of the contributions of fairly recent policy initiatives to promote inter-municipal cooperation – particularly the laws of 1992 and 1999 – has been to change significantly the manner in which they are funded. Municipalities have the right to delegate any function to inter-municipal organisations other than those explicitly deemed to be the responsibility of the mayor, although for some types of inter-municipal organisation some functions are obligatory. This regularisation of functions is another of the contributions of the 1992 and 1999 laws. 2.2. Speciality and exclusivity Inter-municipal organisations cannot work outside of their territorial jurisdictions, nor can they take on functions without the prior agreement of member municipalities. This is the principle of speciality. On the other hand, once a function has been transferred from a municipality to an inter-municipal organisation, the municipality no longer has the right to exercise this function. In practice, however, this principle of exclusivity has

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been hard to enforce and the 1999 law has attempted to remove this jurisdictional uncertainty and the duplication of effort that it has entailed. The extent of transfer of functions from the municipalities to the inter-municipal organisations depends on the agreement that is reached between the member municipalities and on the type of intermunicipal organisation chosen. (This is discussed in sections 3, 4 & 5 below.) Inter-municipal organisations may also, with the agreement of the member municipalities, delegate the management and delivery of services to the private sector. Table 1: Current forms of inter-municipal institutions and their characteristics Single purpose association Multipurpose association Urban Community Communauté d’agglomération Communauté de Communes

In existence since late 19th century. Adhesion and withdrawal following qualified majority vote in member municipal council. Competencies optional. Common for water management, waste management, urban transport. In existence since late 19th century. Adhesion and withdrawal following qualified majority vote in member municipal council. Competencies optional. Common for water management, waste management, urban transport. Established 1966. Extensive compulsory competencies in areas of urban services, infrastructure, planning and economic development. No possibility of withdrawal. Compulsory for Bordeaux, Strasbourg, Lyon and Lille; voluntarily adopted by 10 others. A creature of the Chevènement law of 1999. Intended for contiguous urban areas of more than 50,000 inhabitants with a central municipality of more than 15,000. Compulsory competencies for urban planning and development. Compulsory single business tax. Rules about competencies and mode of funding depend on the size of the Communauté. Broadly speaking a Communauté de Commune in a large urban area is much like the Communauté d’Agglomération.

3. The Development of State Policy for Inter-Municipal Cooperation The basic principles outlined above may be common to all forms of inter-municipal cooperation, but a marked shift has occurred since the early 1990s. The shift is not only in public policy objectives in relation to inter-municipal cooperation, but also in the manner in which public policy is implemented. This new public policy focus has, in turn, resulted in the creation and adoption of important new structures of inter-municipal cooperation, marking a movement from associative forms (financed from municipal budgets) to federative forms (financed directly through local taxation) of cooperation. Until 1992, the first phase of cooperation between the municipalities was largely driven by questions of economies of scale in the provision of technical services (water treatment and distribution, waste management, transport, and so on) in a context of rapid urbanisation. This is not to say that the question of local government restructuring was not important. Indeed, the perceived need for new organisational forms capable of dealing with complex urban policy questions rather than just service provision resulted in the establishment of new

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inter-municipal structures in the form of the District and the Urban Community (established in 1959 and 1966 respectively). Moreover, the creation of these new legal structures paralleled the largely unsuccessful and fervently resisted policy of merging municipalities (Loi Marcellin 1971). Nonetheless, public policy in relation to territorial restructuring prior to 1992 was largely focused on the transfer of functions from the central State to municipalities, departments and regions, and on the territorial deconcentration of central State administrations. Although decentralisation and the transfer of new functions from the central State to the municipalities was an important driver for inter-municipal cooperation, the impetus was essentially bottom-up: the municipalities formed inter-municipal associations when it was in their functional interests to do so, and, undoubtedly, under the influence of isomorphic pressures. The State’s representative, the Préfet, working with the municipalities within the system of crossed regulation,3 as described by organisational sociologists, doubtless sought to maximise the coherence of these associations, but the State’s role was essentially one of legally mandating the structures and rules of engagement. It was not until the 1992 law on the territorial administration of the Republic,4 that inter-municipal cooperation was marked as the rational solution to France’s irrational organisational patchwork (BernardGélabert 2004) and henceforth inter-municipal cooperation became an important instrument of State policy on territorial administration. As indicated above, the issue of local government restructuring and the transition towards federative forms of inter-municipal cooperation had begun before the 1992 law. Furthermore, this law was not altogether successful in inciting the uptake of the new federative forms; the latter began in earnest with the implementation of a supplemental law in 1999 (law of 12 July for the reinforcement and simplification of inter-municipal cooperation).5 In some ways, therefore, the demarcation of periods of inter-municipal cooperation into pre- and post-1992 is not justified. However, the 1992 law marks the use of inter-municipal cooperation as an important instrument of public policy in relation to local government restructuring and (as the name suggests) the 1999 law was designed to further its progress; thus, the pre- and post-1992 demarcation is justified. To understand the important shift in public policy, it is necessary to better understand the pre-1992 landscape of inter-municipal cooperation. This will be outlined briefly before moving on to a discussion of the latest phase of inter-municipal cooperation. 3.1. Pre-1992 inter-municipal cooperation Cooperative inter-municipal cooperation has been a feature of local government since the late 19th century (Bernard-Gélabert 2004). To achieve the necessary economies of scale in the provision of services for which they are responsible, municipalities have two key options: contracting with private sector and joining other municipalities to create inter-municipal organisations. Prior to 1992, the two principal types of inter-municipal organisation were the single purpose intermunicipal association (SIVU) and the multi-purpose inter-municipal association (SIVOM). In 1992 there were approximately 17,000 of these throughout France

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(Ministère de l’Intérieur 2005), covering the majority of municipalities. Although these organisations still exist, their numbers are declining in favour of the new generation of federative inter-municipal organisations that fulfil the old technical functions of the SIVOMs and SIVUs as well as new strategic ones. In contrast to the new organisations, the municipalities have ample scope to mould the old organisations to their own tastes and needs. Competencies are not defined by administrative law, but are for the member municipalities themselves to determine and define. Likewise, no rules govern the boundaries of cooperation; member municipalities need not necessarily be contiguous nor even within the same department (Bernard-Gélabert 2004). The duration of cooperation is also for the municipalities to determine, and often an inter-municipal organisation which began simply as a vehicle for studying the feasibility of an inter-municipal organisation is transformed into an organisation for eventual delivery. However, while this flexibility has undoubtedly been very attractive for the municipalities fearful of surrendering their sovereignty, it has also contributed to an extreme lack of transparency in the organisation of services. Competencies in theory should be very clearly defined at the outset in order to respect the principles of speciality and exclusivity. In practice, this has not always been the case, and the à la carte nature of cooperation makes it hard to determine precisely which organisations are responsible for which services or elements of service. The desire on the part of the central State to promote inter-municipal cooperation and to assert some control over the ad hoc formation and development of inter-municipal organisations is not new. In 1959 the principle that the decision to join an inter-municipal organisation had to be unanimous within each member municipal council was overturned in favour of qualified majority voting (Bernard-Gélabert 2004), and this paved the way for more widespread intercommunal cooperation; in particular, in the (supposedly) more effective multipurpose organisations (the SIVOMs). The year 1959 also saw the creation of a new form of multi-purpose inter-municipal organisation: the District. This new form established two key principles, which have been reinforced in more recent policy: the principle of minimal obligatory competencies and the principle of independent fiscal resources, whereby inter-municipal organisations raise their own fiscal revenue directly rather than rely on contributions from the budgets of their member municipalities. (See box 1). The notion of contiguous geographical and economic space in the form of the agglomeration for urban areas and pays for rural areas also emerged with the creation of the District. While it was not mandatory for Districts to cover such contiguous space, it was deemed desirable (Bernard-Gélabert, Labia 1997). In 1966, the Communauté Urbaine was created. Urban planning, infrastructure development and the provision of key urban services were among its obligatory competencies. It was further given the power to raise its own fiscal revenue. Once a municipality joins a Communauté Urbaine it has no option to withdraw from it. This form of inter-municipal cooperation is, therefore, regarded by the municipalities as the least flexible. On the other hand, more than any other form, it can be regarded as a “real level of administration” (Bernard-Gélabert 2004). In 1966 four Communautés Urbaines were created compulsorily in Lyon, Lille,

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Strasbourg and Bordeaux, but, because of their inflexible nature, since then only 10 agglomerations have voluntarily opted to establish one. In 1983, a new structure, the syndicat d’agglomération nouvelle (SAN) was created for the three largest urban agglomerations – Lyon, Paris and Marseille (Bernard-Gélabert 2004). Even if the creation and membership of inter-municipal organisations remains voluntary, since 1992 government policy has raised the financial incentives for their establishment, simplified the creation and adhesion process, and sought to limit the à-la-carte nature of inter-municipal cooperation by designating obligatory blocks of competencies. 3.2.

New post-1992 inter-municipal cooperation

This new phase of inter-municipal cooperation started with the 1992 and continued with the 1999 laws. In addition to these laws specifically addressing inter-municipal cooperation, other pieces of legislation such as the Voynet and Gayssot laws, the 2002 law on proximity and the latest raft of decentralisation reforms have also had a bearing on the development of inter-municipal cooperation. 3.2.1.

1992 law on territorial administration

The 1992 law on territorial administration came ten years after the 1982 decentralisation law, following the growing realisation that the institutions of territorial government were a significant brake on further decentralisation. Nevertheless the law typifies the trend in French public policy on territorial administration to raise the spectre of restructuring without actually calling into question the institutional status quo. In this context, inter-municipal cooperation came to be seen as the solution to municipal fragmentation. The accent of policy became one of shifting cooperation from association to federation. Lerousseau (1993) argues that the integrative or federative inter-municipal cooperation promoted by the 1992 law differs from the old associative inter-municipal cooperation in three ways: (1) In terms of objectives: Whereas the old cooperative forms focused on service delivery, the idea behind the new forms was that inter-municipal cooperation should be much more strategic and transversal. As the preamble to the law states, it is about “spurring local economic development and ensuring balanced spatial planning and development within an area of solidarity” (Project de loi no. 1581 1990, quoted in Lerousseau 1993: 40); (2) In terms of decision making processes: The new forms are “radically different” from the old in that the vote of each member municipality does not necessarily carry equal weight, and decisions are taken by a majority rather than unanimity of the Board of the inter-municipal organisation. Decisions, therefore, could possibly go against the interests of some of the member municipalities (ibid); and (3) In terms of the mode of finance: This point is taken up more extensively in the box below. With a view to setting decisions about inter-municipal cooperation on a more rational footing than hitherto, the 1992 law established two important new institutions: a Departmental Commission for Inter-municipal Cooperation and a Departmental Plan for Inter-municipal Cooperation. The purpose of the Departmental Commission

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was to develop the Departmental Plan. It is presided by the Prefect – a provision that understandably was not without controversy among local elected officials – and comprises municipal elected officials (60 percent), presidents of existing intermunicipal organisations (20 percent), departmental elected officials (15 percent), and regional elected officials (5 percent). The notion of a Departmental Plan to reinforce and rationalise inter-municipal cooperation for many local elected officials raised the spectre of the 1971 law on the merger of municipalities (Lerousseau 1993). Elected officials therefore sought maximum participation, albeit deliberating under the direction of the Prefect, who henceforth was effectively given the power to determine the geographical boundaries of the new organisational forms (Bernard-Gélabert & Labia 1997). The objective of the plan was to establish a blueprint for the creation of two new structures established by the 1992 law: the Communautés de Villes and the Communauté de Communes, and to extend the adoption of Districts and Urban Communities with a view to reducing the number of old Syndicats. However, despite the establishment of the Departmental Commission, State policy on inter-municipal cooperation failed to be fully implemented in practice. This is for several reasons. First, while the plan was being developed, the municipalities were still entitled to continue to develop the old Syndicats and furthermore, the Commission was not obliged to conclude that existing structures needed to be replaced. Indeed, that the number of single-purpose Syndicats continued to grow during the 1993-1999 period (Ministère de l’Intérieur 2005) evidences that a number of municipalities were not strictly respecting the spirit of the 1992 law. Second, the 1992 law failed to establish a firm legal basis for the Departmental Plan, with the result that the municipalities were merely obliged to take account of it in their future decisions on inter-municipal cooperation (Lerrousseau 1993). Third, the two new forms of inter-municipal organisation – the Communauté de Communes and the Communauté de Villes – were designed to better meet the different needs of urban and rural areas; the former intended for adoption in rural areas (the pays) and the latter for adoption in urban areas (the agglomerations). In practice, the urban/rural division was not maintained. Only five Communauté de Villes were established in the 1992-1999 period and the structure was eventually replaced by the Communauté d’Agglomération under the 1999 law. The Communauté de Communes, on the other hand, proved popular in both rural and urban areas, its number increasing from 193 in 1993 to 1,347 in 1999 (Ministère de l’Intérieur 2005). The reason for the popularity of the Communauté de Communes relative to the Communauté de Villes lies in the fact that the obligatory competencies (covering urban planning and economic development, environmental protection, housing, roads and urban transport, cultural and sport infrastructure) stipulated for the former are far more extensive than for the latter (Bernard-Gélabert & Labia 1997), thus narrowing the margin of decision for the member municipalities about which functions are transferred from the municipalities. Although the 1992 law undoubtedly raised the stakes for inter-municipal cooperation by making it a key pillar of territorial administration and introduced a number of new principles, progress was not what the legislators hoped for in terms

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of the modernisation of urban inter-municipal cooperation. In 1999 a further law was introduced to reinforce the development of inter-municipal cooperation towards more federative and integrative forms. 3.2.2.

The Chevènement Law 1999

As discussed, one of the key barriers to the modernisation of inter-municipal cooperation was the weakness of the 1992 law and the tendency of the municipalities to mould the instruments offered to suit local circumstances. As the case study above and below illustrates, even the creation of a new inter-municipal structure like the District, endowed with specific competencies and formal status, did not guarantee clear demarcation of responsibilities between the inter-municipal structure and the member municipalities. The 1999 Chevènement law, so-called because its champion was the Socialist interior minister Jean-Pierre Chevènement (himself more in favour of the strengthening of the department over the region (Scargill 1998)), represents the most strident effort yet to standardise organisational structures, choices and decision-making procedures, while two parallel laws on territorial planning and sustainable development (Loi Voynet/LOADDT6) and on urban solidarity and regeneration (Loi Gayssot/SRU7) afford the new federative inter-municipal organisations with their own fiscal resources a privileged role in spatial planning and development. At the structural level, federative forms were boiled down to just three types: Urban Communities, Communautés d’Agglomération and Communautés de Communes. The Districts and Communautés de Villes were to be phased out through conversion to one of the other three forms or through dissolution. The creation of the new Communauté d’Agglomération for conurbations of more than 50,000 inhabitants with a central municipality of more than 15,000 inhabitants was intended to be a specifically urban structure. By and large, the new 1999 rules outlaw the co-existence of the old syndicats and new federative structures, although in practice it has failed to do so. Given the sensitivity around the issue of the transfer of competencies from the municipality to the inter-municipal communities and the conflicts of interest and duplication of effort that can arise where competencies are not clearly defined, the 1999 law sought to instil greater clarity by defining specific blocks of competencies which are either obligatory or among which inter-municipal organisations must choose. As Table 2 below illustrates, each type of inter-municipal structure carries different blocks of competencies. At the top of the table is the simple Communauté de Commune (with its own fiscal resources, but without the single business tax). For this category of inter-municipal organisation, the municipalities can exercise a great deal of choice as to the competencies they transfer. Moving down the vertical axis of the table, the choice of competencies is increasingly constrained, and for the Communauté Urbaine – perhaps unsurprisingly the least popular type of inter-municipal structure – the compulsory functions are comprehensive.

Economic, social and cultural development and planning; Spatial planning; Social balance in housing within the community Town policy Management of services of collective interest (water, cemeteries, emergency services) Protection and use of the environment

1. 2. 3. 4.

1.

Communautés d’agglomération

Communautés urbaines

6.

2. 3. 4. 5.

As above

Spatial planning Actions for economic development: planning, management and maintenance of industrial, commercial, service & artisanal zones, ports or airports (must be specified) Economic development Community spatial planning Social balance in housing within the community City management (crime and disorder, social exclusion etc.)

1. 2.

Communauté de communes with single business tax

Three blocks of the following five must be chosen: 1. Creation, planning and maintenance of highways and car parks; 2. Water treatment 3. Water distribution 4. Environmental protection and use 5. Construction, planning and maintenance of cultural and sports facilities None

Semi-optional functions One block must be chosen from the following: 1. Protection and use of the environment 2. Housing Policy, planning and maintenance of highways 3. Construction, maintenance and management of cultural and sporting facilities and pre-school and primary school education

Simple Communauté de communes

Blocks of compulsory functions 1. Spatial planning 2. Actions for economic development (determined by member municipal councils)

As above

As above

As above

Optional functions Any other functions deemed to be of community interest. These may be decided by qualified majority vote at the time of or after the establishment of the organisation.

Table 2: The competencies of inter-municipal structures with their own fiscal resources (Adapted from Association des Maires de France 2002)

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To further assist the municipalities in determining the division of responsibilities between their inter-municipal communities and the member municipalities, the 1999 law introduced the notion of “community interest”.8 The principle is that, where competencies are not specified in their entirety, there is scope for negotiation between the communities and their member municipalities regarding precisely which functions and competencies are to be taken by which organisation. There are, however, differences between the types of community as to which competencies are negotiable and the manner in which they are negotiated. In the case of the Communauté de Communes, it is the individual elected municipal councils who decide which competencies will be transferred from the municipality to the inter-municipal Community, and which will remain the responsibility of the member municipalities. For the Communauté d’Agglomération and the Communauté Urbaine, functions in the community interest are decided by the Community council with a two-thirds majority. Certain functions, however, are not subject to the community interest vote, but must be taken on in their entirety. As discussed above, it is the simple Communautés de Communes that have the greatest margin to negotiate on competencies and the Communautés Urbaine that have the least. 4. The New Imperatives for Inter-municipal Cooperation There are two critical and interlinked challenges for territorial administration that have been important policy drivers for the strengthening of inter-municipal cooperation. The first, which has already been alluded to in the introduction, is the problem of economic and social development and the capacity of the current institutional architecture to deal with the growing challenges of service provision and competitiveness, particularly in urban areas. The second, which is closely linked to the first, is that of fiscal containment and equalisation. Recent central State policy on inter-municipal cooperation has sought to achieve a greater level of integration and coordination among member municipalities than that provided by the older, associational forms of cooperation. The thrust of government policy since 1959, beginning with the creation of the District, has been to move inter-municipal cooperation from associative forms, funded from the budgets of the member municipalities, to federative forms with their own revenue raising capability. (See box 1.) In 1980 this policy was given new impetus with a law enabling all inter-municipal organisations to establish their own single tax, either the business tax or the property tax, and this policy has been much reinforced since the 1992 law on territorial administration. With the 1992 law the single business tax regime became optional for the Communautés Urbaines and the now obsolete Urban Districts and Communautés de Villes. The 1999 law rendered the regime compulsory for the new Communautés d’Agglomération and any new Communauté Urbaine and for certain Communautés de Communes.9 (See Table 4 for an overview of the extent of the uptake of the single business tax regime.) To understand why it has been a policy priority to encourage the establishment of federative inter-municipal cooperation with the single business tax regime, it is first

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necessary to know something about the peculiarities of local government finance in France. There are four types of local government tax, known as the quatre vieilles: property tax on built property, property tax on non-built property, residence tax, and business tax. These represent some 80 percent of the fiscal resources of the municipalities. Additional taxes include one on household waste. With the exception of the business tax, these are calculated on the basis of property rental values. The business tax accounts for on average about 48 percent of the total product of direct taxes (although this varies from 33 percent for rural municipalities with less than 700 inhabitants to around 50 percent for the urban municipalities with over 20,000 inhabitants), while the property and residence taxes account for the rest. Levels of taxation are decided among the assemblies of the municipalities, the departments and the regions. They account for some 55 percent of local government revenue, the rest coming from central government funds, grants and borrowing. The taxes are collected by the territorial agencies of the central State and allocated on a monthly basis to the municipalities, inter-municipal institutions, departments and regions. Fiscal inequality is marked in France, precisely because of the highly fragmented nature of local government. By far the primary source of this inequality is the business tax, illustrated by the fact that just 10 percent of municipalities account for a staggering 90 percent of the business tax potential (Verheyde 2003). Many attempts have been made by central government to alleviate this inequality without fundamentally compromising the fiscal autonomy of the municipalities. A series of mechanisms for the horizontal redistribution of business tax among municipalities was established by law in 1975 with the departmental fund for the equalisation of business tax (Mouzet 2003). In 1980 a national fund for the equalisation of business tax was also established. In addition, fiscal inequality between municipalities is partly alleviated by the targeting of State funds for municipal revenue funding for both urban and rural municipalities with limited fiscal potential in relation to needs. In 1998 the basis on which business tax is calculated was itself changed in a further attempt to reduce inequalities between municipalities. Despite these various instruments of equalisation, however, fiscal inequality between municipalities remained a serious problem, and indeed a problem that, if anything, became more pronounced after the process of decentralisation and transfer of competences from the central to the local State started in the early 1980s (Saidj 2004). The laws of 1992 and 1999 regarding inter-municipal cooperation have exploited this inadequacy to promote a more rational organisation of local government, and at the same time sought to remedy the inadequacy through the promotion of greater fiscal solidarity between municipalities within a contiguous geographical area. The focus on business tax reflects the policy emphasis on enabling local government to become a key player in local economic development (Leprince 2002). As Table 4 indicates, as of 2004, 37.7 million French citizens now reside within an inter-municipal community with the single business tax.

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Pre-1999 institutions Communauté Urbaine District (≤500,000) District (≥500,000) Communauté de commune Communauté de ville Syndicat d’agglomération nouvelle Post-1999 institutions Communauté Urbaine Communauté d’agglomération Syndicat d’agglomération nouvelle Communauté de commune (≥500,000) Communauté de commune (≤500,000)

Precept on local taxes

Precept on local taxes with optional Zoned Business Tax

Single Business Tax (optional)

●

●

●

●

●

●

Single Business Tax (compulsory)

● ●

●

● ● ●

● ● ● ● ●

●

●

5. Judging the Performance of Inter-municipal Cooperation The ultimate test of whether recent policy on strengthening inter-municipal cooperation must be in whether the functions previously exercised by the individual municipalities are more effectively exercised by the new inter-municipal communities. Are services more effectively delivered? Is social, economic and environmental development more effectively planned within the boundaries of the new intermunicipal spaces? Has inter-municipal cooperation helped reduce the gaping inequalities between neighbouring municipalities? Fundamental though these questions

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Table 4: Development of inter-municipal cooperation since 1992 (adapted from Direction Générale des Collectivités Locales, 2005)

Communauté Urbaine Communauté d’agglomération Communauté de Communes Syndicat d’agglomération nouvelle District Communauté de villes No of inhabitants within institutions with own fiscal resources (millions) No of inhabitants within institutions with single business tax (millions)

1992 9

1993 9

1999 12

2000 12

2001 14

2002 14

2003 14

2004 14

50

90

120

143

155

193

1,347

1,533

1,733

2,032

2,195

2,286

9

9

9

9

8

8

8

6

214

252 3

305 5

241 -

155 -

-

-

-

16.1

33.2

36.9

40.4

45.1

48.8

50.7

2.1

4.2

13.0

20.8

29.7

35.4

37.7

are, evidence on the success of inter-municipal cooperation has nonetheless been scant. As Leprince (2002) points out there has never in fact been a proper debate about the criteria against which success should be judged. Ministers have a tendency to point to quantitative data on the formation of new structures as evidence of success (as for example the Ministère de l’intérieur in its annual review of progress (Ministère de l’intérieur, 2004 and 2005)). As Table 4 above illustrates, the establishment of the new Communautés has been dramatic throughout the latter part of the 1990s, with the result that some 51 million French citizens now reside within a municipality that belongs to a Communauté with its own tax-raising power, some 38 million of which are within a Communauté with the single business tax. However, as concrete indicators of a genuine strengthening of inter-municipal cooperation, the figures need to be treated with some caution. The history of inter-municipal cooperation in France has been characterised by a tendency for the municipalities to avail themselves of the financial incentives for cooperation offered by the State, but to limit the extent of genuine cooperation. To what extent can recent legislation be said to have altered this pattern?

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Box 1: The funding of inter-municipal cooperation: from association to federation The old generation inter-municipal associations (the syndicats) are funded from the budgets of the member municipalities. Each year a budget is agreed on by the inter-municipal committee, comprising representatives from the municipal councils, and each municipality pays a proportion of that budget. With the new federative inter-municipal communities (Communautés Urbaines, Communautés d’Agglomération and Communautés de Communes), on the other hand, inter-municipal organisations are funded directly from local taxation. There are essentially two fiscal regimes10 for federative forms of inter-municipal cooperation currently in operation. (See Table 3.) The first, which is available only to the small Communauté de Communes, is one in which the inter-municipal committee, having agreed on its budget, sets a precept, alongside the other institutions of territorial government (municipalities, departments and regions) on local taxes. The level of taxation is decided by the inter-municipal committee, and local tax payers will see two rates on their tax bills – one determined by the municipality, and therefore variable across the municipalities, and one determined by the Communauté de Communes.11 This regime has proven highly inflationary. As responsibilities were transferred from the municipalities to the inter-municipal communities, the former tended not to reduce local taxation commensurately. Reducing the scope for fiscal inflation was an important objective of the 1999 law. The second regime, which is available to the Communautés de Communes if they choose it and compulsory for the Communautés d’Agglomération and Communautés Urbaines, is that of the single business tax12 (See Table 3.) In essence this means that expenditure is met solely through business tax, the rate of which instead of being set by each individual municipality is set by the inter-municipal community; hence the name single business tax. All other taxes remain the preserve of the municipalities. If the municipalities so choose, there is an option to impose a single business tax within a specific enterprise zone available to the Communautés de Communes that have not opted for the full single business tax regime and to the Communautés Urbaines established before the 1999 law. (See Table 3.)

A recent report by the French Cour des Comptes to the French President (2005)13 has for the first time sought to address this question. Although some may find the picture it paints of modern inter-municipal cooperation unduly negative, it is an essential corrective to the blindly optimistic quantitative analysis of institutional formation. Its findings will be drawn on extensively in this section. Before examining the impact of post-1992 inter-municipal cooperation on planning, development and solidarity, and public services, we will first examine whether, on close inspection, there has been a genuine strengthening of intermunicipal cooperation or whether the new structures are merely empty shells (coquilles vides). 5.1. Genuine cooperation or “coquilles vides”? The question has not been an easy one to answer as it is multi-faceted and requires the collation of significant quantities of detailed case data. Implicitly, the Cour des Comptes seeks to answer the question by asking the following: • Are the boundaries of inter-municipal cooperation pertinent to the attainment of common objectives in relation to service delivery and spatial planning for economic and social development? • What is the extent of transfer of functions from municipalities to intermunicipal structures?

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To what extent do the financial regimes in place ensure the sustainable funding of the transferred functions?

5.1.1. The pertinence of boundaries The question of scale and boundaries, particularly for urban areas, became an increasing preoccupation from the 1980s onwards. As has already been amply noted, the institutional fabric of local government and administration in France has little evolved from its rural roots. All municipalities are equal and only 36 municipalities have more than 100,000 inhabitants, the vast majority comprising under 10,000 inhabitants (Ministère de l’intérieur 2005). While inter-municipal cooperation has given France an urban gloss, at least at the level of infrastructure and service provision, the notion of urban space has not been a prominent feature of French local economic and social development. With low levels of strategic cooperation around economic development, the municipalities tended to compete with each other to attract and retain inward investment. As noted above, the Communauté de Ville, created specifically as a vehicle for cooperation around urban economic development was an abject failure, and the Communauté Urbaine, the most integrated and focused on urban development, has never been a popular choice for the municipalities. The thrust of the 1999 law was to mollify this tendency to promote the individual municipality above the urban space. This was to be achieved through the creation of the Communauté d’Agglomération and through the specification of comprehensive compulsory blocks of competencies around urban spatial planning and economic development, in addition to the traditional urban service functions of inter-municipal organisations. An important law to promote solidarity in urban spatial, economic and social development was introduced in 2000 (La Loi SRU relative à la solidarité et au renouvellement urbain). The overarching law, which has three principal objectives – the promotion of strategic planning, social balance in housing, and sustainable transport planning – affords the inter-municipal communities important new responsibilities. They are now responsible for the development of new strategic plan for metropolitan areas (le schéma de coherence territoriale, SCOT) to which all local plans must conform. Another key element of State policy on inter-municipal cooperation since 1992, particularly with the 1999 law, is the reform of local government finance that it induces. With the emphasis on a common (urban) business tax, this policy also strengthens the focus of inter-municipal cooperation on (urban) economic development. Given the desired orientation of inter-municipal communities to take the lead on “urban projects”, it is important that the boundaries of inter-municipal cooperation are defined accordingly. Prior to the 1999 law, there were no firm guidelines for defining the boundaries of inter-municipal cooperation. With the 1999 law, however the INSEE definition of urban space (aire urbaine)14 as contiguous space without enclave was adopted. However, as the the Cour des Comptes report points out, this important principle is not always respected in practice, and indeed, derogation is permitted by the law if one or several municipalities threaten to block the establishment of an inter-municipal community within an agglomeration. It cites cases where, for example, the smaller municipalities have formed defensive urban com-

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munities in order to avoid the domination of larger municipalities. The report further notes that, in some cases, boundaries have precluded any kind of solidarity (in the sense of transferring resources from wealther to poorer municipalities) as they have been strategically established to exclude municipalities with high levels of social need. 5.1.2. The transfer of competencies The Cour des Comptes notes that almost universally the municipalities have sought to honour the letter of the 1999 law with regard to the range of functions they are required to transfer from the municipalities to the new inter-municipal structures. (See Table 2.) However, it notes also that the principle of community interest, which (as noted in section 3.2.2 of this chapter) affords the municipalities considerable scope to negotiate on the extent to which even obligatory functions are transferred, has meant that, in many cases, functions are transferred only partially. Among the reasons cited are resistance to transferring the services and capital assets required to carry out the functions, and resistance to transferring services from the old associative structures, which in many cases still operate alongside the new federative structures. It further notes that, paradoxically, it is on the transfer of optional functions that the municipalities have been successful in securing clear agreement. A significant obstacle to the clear definition of functions lies in the fact that the notion of community interest has been left entirely up to the municipalities themselves to define, the legislator having backed away from attempting even to set out a set of definitional parameters (further testimony, no doubt, to the influence of the Senate during the passage of the legislation). The result is that definitions are variable between inter-municipal structures and, often, from one domain of competence to another within the same structure. Such picking and choosing of definitions of community interest (or intercommunalité à la carte) leaves a great deal of uncertainty as to the division of responsibilities between the inter-municipal communities, the old syndicats and the member municipalities. As the Cour des Comptes points out, this serves to seriously undermine the fundamental principles of inter-municipal cooperation – speciality and exclusivity – necessary for the coherent, effective and efficient functioning of public services. The extent to which the municipalities and inter-municipal communities expediently invoke and define the community interest principle is clearly an important determinant of the extent of genuine transfer of functions. It is not, however, the only determinant. Once competencies have been determined, it is important to establish a financial framework capable of ensuring their sustainable execution. That current financial arrangements are providing this is far from clear. 5.1.3. Financial sustainability The principle means of strengthening inter-municipal cooperation has been through the regulation of the mechanisms for funding the various intermunicipal communities, and in particular to promote direct funding through taxation rather than indirect funding through the budgets of the member municipalities. (See box above.) The fiscal revenue of the new inter-municipal communities must cover not only the functions transferred from the municipalities, but also any further collective investments. Therefore, the fiscal question has been

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and continues to be a preoccupying one. An important question examined by the Cour des Comptes was whether the new financial framework would leave the new inter-municipal communities sufficient financial flexibility to pursue their collective missions. While the law sets the broad parameters for determining the level of fiscal integration within the various inter-municipal communities, the municipalities still have some scope to exert their individual wills over the inter-municipal collective. A significant problem has been the rate of the initial collectively- levied business tax and its variation in subsequent years. The initial rate is linked to the average rate of business tax previously levied by member municipalities, while its future development is linked to that of the other household taxes still levied by the member municipalities. Of critical importance for the trajectory of inter-municipal integration and the financial stability of the inter-municipal communities, therefore, is the degree of planning and coordination of future movements of revenue and expenditure between them and the member municipalities. Of a sample of 69 cases chosen for close examination of the strategic planning question, the Cour des Comptes found that in only 13 cases could a proper medium-term strategy and financial pact between inter-municipal community and member municipalities be said to have been developed. In most other cases, it noted, there was either insufficient planning (future projects listed, but not proper costing) or no planning at all. In the absence of such planning, the Cour des Comptes notes, the risk of setting the initial rate of business tax either too high or too low, and, therefore, of jeopardising the long-term financial stability of the inter-municipal community, is greatly increased. A critical factor here, and one which has been particularly highlighted by the Cour des Comptes, has been that of fiscal redistribution (how much fiscal revenue is retained by the inter-municipal community and how much is redistributed back to the municipalities). The inter-municipal communities with their own business tax must compensate the municipalities via the compensatory fund15 for the business tax revenue they have foregone, net of the financial commitments that are transferred to the inter-municipal communities.16 If the costs of the transferred functions are accurately calculated – and, as the Cour des Comptes notes, they often are not – the effect on the inter-municipal community’s budget ought to be neutral. Two other options for the redistribution of fiscal revenue and central State revenue support are, however, available. By their very nature, the effects of these are not fiscally neutral. These are (1) the solidarity fund,17 the amount of which is determined by the Community Council, but is relative to the size of the municipality eligible for the solidarity fund, its per capita fiscal potential and financial commitments; and (2) a discretionary fund18 for the finance of services whose benefits extend beyond the municipality of organisation. It is the latter which gives the most cause for concern as it offers much scope to fudge the delineation of responsibilities between the inter-municipal communities and their member municipalities. For this reason, the Cour des Comptes has taken the percentage of total revenue (fiscal and central State revenue support) redistributed back to the municipalities to be an important indicator of the development of genuinely financially autonomous inter-municipal communities (as opposed to the “coquilles vides”, established primarily to take advantage of the additional government support on behalf of its member municipalities). Although, the report notes that such cases of blatant opportunism are rare, there is

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powerful evidence that the discretionary fund, and some of the additional central government disbursements along with it, are being used to fund some functions (or elements of certain functions) that ought to have been surrendered to the inter-municipal communities, but, in practice, are retained by the municipalities. 5.2.

The effectiveness of inter-municipal communities in fulfilling collective functions

5.2.1. Planning, urban development and solidarity As discussed in section 4 above, one of the principle policy drivers since 1992 (and arguably even since the creation of the Urban District in 1959) has been to move inter-municipal cooperation beyond common service delivery and for intermunicipal communities to become meaningful vehicles for planning and development, particularly in urban areas.19 Overcoming the resistance of the municipalities to hand over this important strategic function was never likely to be easy, however. A significant problem in this regard, which the Cour des Comptes report highlights, is that local policy makers have, in many cases, had to sell the transition to the new federative inter-municipal communities to the municipalities as a necessary evil rather than a turning point in France’s urban development. This has tended to preclude the development of meaningful strategic documents outlining common projects. The Cour des Comptes report asserts that in many cases the new intermunicipal communities were merely seen as extensions of pre-existing forms (as for example the transition from District to Communauté d’Agglomération) and in others local, elected officials were keen to take advantage of the financial incentives on offer and were, therefore, more focused on fixing boundaries that could be agreed upon rather than spending time on the development of a clear inter-municipal strategy and definition of optimal boundaries. It is beyond the scope of this chapter to comment extensively on the more general issue of territorial governance, but the report also notes problems associated with inconsistent spatial scales for the implementation of different public policies (projet d’agglomération, projet de pays, SCOT). The response to this spatial confusion is often to establish yet another intermunicipal grouping in the form of a mixed inter-municipal association (Syndicat Mixte) to capture the various structures within one entity. Again, this situation is hardly conducive to the clear delineation of responsibilities for planning and development. As noted above, the solidarity fund (discretionary for all but the Communauté Urbaine), unlike the compensatory fund, was explicitly intended to correct fiscal inequalities among member municipalities. Two critical observations have been made by the Cour des Comptes: (1) that the solidarity fund, relative to the other redistributive funds, is insignificant; and (2) that the criteria for redistribution, which within certain guidelines can be determined by the Community Councils, often run counter to the objective of promoting solidarity. In some cases, it notes, the solidarity fund has been used as an additional compensatory fund, not a redistributive one. Out of a sample of 30 Communuautés d’agglomération, more than 60 percent were found to be using the solidarity fund for objectives other than solidarity. On the question of whether the levying of a single business tax has helped increase urban solidarity by reducing the sterile fiscal competition between munici-

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palities that has been so characteristic of French urban development, Leprince (2005) offers some interesting insights. He puts forward evidence that, although the inter-municipal economic development under the single business tax regime has eliminated competition between the municipalities in this fiscal area, other forms of competition are in operation. First, there is competition between municipalities to attract new residential building, which increases the base for the other three residential sources of tax. Second, there is qualitative competition between municipalities as the mayors vie for the best employment possibilities within easy commuting distances for their inhabitants. Third, he cites evidence that, although fiscal competition between municipalities may have been attenuated by the new inter-municipal cooperation, competition between neighbouring inter-municipal communities remains, notably between large urban groups and smaller, peri-urban groupings. 5.2.2. Public services Inter-municipal cooperation for the delivery of collective local public services (water distribution and treatment, waste collection and management and urban transport) has a very long history in France, as the section on pre-1992 inter-municipal cooperation has shown. Nonetheless, there have long been concerns about the appropriateness of the scale at which these are organised, particularly with the introduction of more stringent environmental norms, and about the lack of clear division of responsibilities between the various inter-municipal institutions (SIVOMs, SIVUs, Districts, and so on). While post-1992 public policy on inter-municipal cooperation places strong emphasis on planning and economic development, it has also sought to rationalise the delivery of local public services by extending the services that the new generation inter-municipal communities are required to take over. Indeed as Douence (2003) points out, local public services are the raison d’être of local government and absolutely essential to the implementation of social, economic and environmental development. The Cour des Comptes makes several pertinent observations in its evaluation report. The first is on the scale of the new inter-municipal communities. As with the old syndicats, scales are often not large enough for the effective delivery of certain public services. This is particularly the case for waste management, where waste treatment facilities (waste-to-energy plants or recycling centres) must operate on a much larger scale than an agglomeration. Even prior to the Chevènement law of 1999, many Syndicats Mixtes, encompassing several urban Districts on a subdepartmental level, were being established for this reason. The new inter-municipal communities – although required by law to take responsibility for public services previously managed by local syndicats, single municipalities or urban Districts – merely transfer this responsibility to a larger Syndicat Mixte, which in turn may contract out the service to a private utility. In this way, it might be said that services are effectively delivered through a complex nexus of contracts, which raises many questions about accountability and control. It certainly throws into question the attachment of the mayors to the municipality as the basic unit of democratic accountability! Second, the Cour des Comptes notes strong evidence that the reorganisation of services on the scale of the new inter-municipal communities has led to improvements in the quality of public services. In many cases it has facilitated the compli-

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ance with new and stricter environmental norms. However, as this is inevitably accompanied by an increase in service charges, it is hard to come to any judgement about value for money. Third, on the important question of equality among services users, the report notes that variable user charges are often in operation across a single inter-municipal community because of pre-existing contracts between the member municipalities and the private utilities. It cites the example of water distribution and treatment in the Communauté d’Agglomération of Seine-Eure by way of illustration of the cost and complexity of seeking equality through contractual harmonisation. In this case, it was decided that, on establishing the new inter-municipal community, the 21 pre-existing contracts between member municipalities and a private French utility would be re-negotiated with a view to harmonizing contractual clauses and user charges. No such renegotiation was undertaken between municipalities working with a different private utility, and those working under direct service organisation were not affected. This resulted in a substantial average increase in user charges. The key point here is that solidarity can be achieved, but only at a heavy cost. 6. Concluding Remarks The evidence cited here on progress towards strengthening inter-municipal cooperation and the effectiveness of the new inter-municipal communities in fulfilling collective functions, being mainly from a single source, must of course be treated with some caution. The damning conclusion of the Cour des Comptes – that, on balance, the latest wave of inter-municipal communities are little more than agencies for the collection of fiscal and State resources for their municipal masters with no real means of carrying out genuine inter-municipal projects – is a conclusion that many would dispute. This is a development to which, the Cour des Comptes further argues, the State prefects simply turned a blind eye. Even so, what cannot be emphasised enough is that the latest policy initiatives are part of an ongoing policy process in which successive governments have grafted tentative administrative reform upon tentative administrative reform without ever tackling the political restructuring that so many argue is necessary for France to operate in a global and European economy (Rémond 2002, Caillosse 2003, Ohnet 2002). Recent legislation on inter-municipal cooperation similarly embraces the administrative/functional end of local government restructuring while leaving the political dimension untouched. Specific provisions in the legislation (for example, the principle of community interest and the principle of compensation) leave the door wide open for the will of individual municipalities to assert itself over the interests of the inter-municipal community, while the question of direct elections to the community councils has, for the time being, been put on the back burner. That said, there are real imperatives to develop deeper and more meaningful inter-municipal cooperation that cannot be ignored. The notion of agglomeration for urban areas and pays for rural areas has been steadily creeping into public policy since the 1950s and various laws have converged to embed the idea of “inter-municipal project” in the minds of local policy makers and their publics. In

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addition to the laws of 1992 and 1999 on territorial restructuring and inter-municipal cooperation themselves, the various laws of Decentralisation act II recognise the inter-municipal community as the fourth territorial institution alongside the region, the department and the municipality. The 2000 law on urban solidarity and regeneration (SRU) places the responsibility for the coherence of urban policy making on the inter-municipal communities. Other policies, such as the urban waste law of 1992, are scarcely implementable without extensive inter-municipal cooperation and growing concerns about the capacity of the municipalities to manage private contractors, particularly in water treatment and distribution, is a further imperative to more extensive inter-municipal cooperation. Given its history as France’s premier revolutionary institution, it is scarcely surprising that the municipality is seen by many as the institution to be retained at all costs. As inter-municipal projects develop, however, the modernisers’ calls for direct inter-municipal elections are unlikely to be silenced forever. References Association des Maires de France (2002). La coopération intercommunale à fiscalité propre. AMF. Bernard-Gélabert, M.-C. (2004). L’intercommunalité. Librairie Générale de Droit et Jurisprudence: Paris. Bernard-Gélabert, M.-C., & Labia, P. (1997). Intercommunalités mode d’emploi. Economica: Paris. Blanc, J., & Rémond, B. (1994). Les collectivités locales. Dalloz. Bourdin, J. (2001). Les finances communales. Economica: Paris. Bourdon, I. (2003). Quelle instrumentalisation des Communautés d’agglomération pour le développement économique? Pouvoirs Locaux, 57(2), 125-132. Caillose, J. (2003). La decentralisation. Acte moins deux. Pouvoirs Locaux, 57(2), 7-14. Cour de Comptes (2005). L’intercommunalité en France. Rapport au president de la république suivi des réponses des administrations et des organismes intéressés. Douence, J.-C. (2003). Intercommunalité et service public local. Annuaire des collectivités locales, CNRS Editions. Doumbia, I. (2003). Modalités de financement par le budget communal du budget intercommunal. Editions du Juris-Classeur, Collectivités Territoriales, Mai 2003, 5-10. Leprince, M. (2002). L’évaluation des effets de la cooperation intercommunale sur la pression fiscale locale. Pouvoirs Locaux, 54(3), 62-68. Leprince, M. (2005). Intercommunalité: une fiscalité maitrisée? Pouvoirs Locaux, 64(1), 62-8. Lerousseau, B. (1993). Les institutions de l’intercommunalité dans la loi du 6 février 1992. In Bourjol et al (Eds.), Intercommunalité et cooperation intercommunale. Librairie Générale de Droit et Jurisprudence: Paris. Ministère de l’intérieur (2005). Les collectivités locales en chiffres 2005. Direction Générale des Collectivités Locales: Paris. Mouzet, P. (2003). Finances locales. Gualino Editeur: Paris. Ohnet, J.-M. (2002). Le plein et le vide. Pouvoirs Locaux 57(2), 3. Ohnet, J.-M. (2002). Décentralisation: Le retour du politique? Pouvoirs Locaux 54(3), 3. Rémond, B. (2002). Décentraliser: Vraiment? Enfin! Pouvoirs Locaux, 55(4), 83-90. Saidj, L. (2005). Fiscalité locale: Un système de financement inadapté. Problèmes Economiques, La Documentation Française, No 2.874, 2-7. Scargill, I. (1998). The French region: A flawed institution? Regional Studies, 32(0), 879-885. Schmidt, V. (1990). Democratizing France. Cambridge, UK: Cambridge University Press. Verheyde, O. (2005). Fisalité locale: les finances locales françaises: Une comparaison européenne. Problèmes Economiques, La Documentation Française, No 2.874, 8-15.

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Notes 1

Decentralisation Act II consists of a range of pieces of legislation: La loi constitutionnelle relative à l’organisation decentralise de la République, mars 2003; La loi organique relative au referendum local, août 2003; La loi organique relative à l’expérimentation, août 2003; La loi organique relative à l’autonomie financière des collectivités territoriales, juillet 2004. 2 Etablissements publics de cooperation intercommunale (EPIC). This term is by no means neutral; rather it places inter-municipal organisations firmly in the category of administrative rather than political entities. 3 La régulation croisée. 4 Loi du 6 février 1992 relative à l’administration territoriale de la République. 5 Loi du 12 juillet 1999 relative au renforcement et à la simplification de la cooperation intercommunale. 6 Loi d’orientation sur l’aménagement et le développement durable du territoire, juin 1999. 7 Loi Solidarité et renouvellement urbain, décembre 2000. 8 L’intérêt communautaire. 9 For this category of inter-municipal community, the rules regarding fiscal regime are more complex. For Communautés de Communes, which have been formed from the old Districts or Communautés de Villes, adoption of the single tax regime is compulsory. It is also compulsory for Communautés de Communes grouping more than 500,000 inhabitants, except where at least half the member municipal councils vote against it. 10 There is also a third fiscal regime, but uptake so far is marginal (Leprince 2005) and is therefore not discussed. 11 A formula that must be adhered to in setting local rates of taxation is designed to limit the extent of fiscal inflation, the potential for which is greater when two local entities have fiscal autonomy. 12 Taxe professionnelle unique. 13 The Cour des Comptes (Court of Accounts) is an independent court charged with the audit of public accounts. It has branches in every French region (chambres régionales des comptes). Data for the report were drawn from the Ministry of the Interior, the Ministry of Finance, DATAR and the Prefectures. In addition the regional chambers gathered comprehensive (quantitative and qualitative) data from a representative sample of inter-municipal communities. 14 A number of municipalities forming a continuous space without enclave, constituted by an urban centre which consists of 5,000 jobs and by rural municipalities or urban units of which at least 40% of the resident population work within the centre or a municipality around the centre. 15 L’Attribution de Compensation 16 Prior to 2004 this was determined formulaically, but the law on local freedoms and responsibilities has granted the right of the inter-municipal communities to determine, by unanimous vote, the rate at which they compensate the municipalities for lost revenue. 17 La Dotation de Solidarité Communautaire 18 Le Fonds de Concours. 19 Known as “l’intercommunalité de projet”.

CHAPTER 5 WERNER HEINZ

INTER-MUNICIPAL COOPERATION IN GERMANY: THE MISMATCH BETWEEN EXISTING NECESSITIES AND SUBOPTIMAL SOLUTIONS

With some 82 million inhabitants, Germany is the most populous nation-state in Europe. Almost one-third of the population live in cities with more than 100,000 inhabitants. Compared to other European countries, this degree of urbanisation is rather ordinary; what is peculiar is the high number of cities (83), the majority of which are located in the “old German states” (alte Bundesländer) (Städtetag 2003: 26, 30). Problems with coordination between cities and their environs – especially when it comes to urban structures and infrastructure facilities – are neither unique to Germany nor are they new, as evidenced by the history of inter-municipal approaches for cooperation. Single-function or single-purpose cooperative approaches, the most widespread form of cooperation at present, were allowed for in the Local Law of the German Empire in the late nineteenth century. After World War I, single-purpose cooperative institutions numbered more than 15,000 (Emig & Hermann 1996: 37). And in the course of the territorial reform of 1967 to 1977 (Von Unruh et al. 1981), a series of amalgamations and local mergers were realised along with a number of new cooperative approaches between cities and their surroundings. Leading actors and influential factors in inter-municipal cooperation are the different levels of the public administration and territorial authorities under public law. Problems and restrictions confronting innovative approaches for cooperation are quite frequently the result of characteristics and diverging interests of existing political-administrative structures. The following chapter is structured into four sections. The first gives an overview of the political-administrative structures into which German cities and their R. Hulst and A. van Montfort (eds.), Inter-Municipal Cooperation in Europe, 91–115. © 2007 Springer.

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cooperative approaches are embedded: from the federal system and distribution of powers between the different administrative levels to the system of local authority finances and taxes that foster inter-municipal competition and hinder cooperation. This section considers the different approaches for classifying the numerous city-regions in Germany (with strong economic and demographic interconnections) and how these classifications are incompatible with existing, fragmented structures on the local level. The second section picks up this argument and looks for the necessity and underlying reasons for closer cooperation between neighbouring cities and within city-regions in Germany. The forms of cooperation realised to date are the subject of the third section. Despite their broad spectrum they can be assigned to a few different categories, distinguished by criteria like degree of institutionalisation and scope of activities. In this section a first distinction is made between approaches that are institutionalised under public law and those that are not (informal or under private law). A second distinction concerns the four groups under public law, which range from associations confined to special-purpose cooperation on a territorial base to the establishment of new public or municipal authorities (Gemeindeverbände). The fourth section presents a critical view on two questions. The first concerns the reason for the frequent mismatch between pressing necessities and realised cooperative approaches, and the second addresses some prerequisites for the implementation of broader and more resilient forms of cooperation. The chapter ends with an ambivalent conclusion: Although the chances that suboptimal solutions will prevail in the future are regarded as high, signs of more problem-compatible development are on the horizon. 1. Political-administrative Framework 1.1. Local authorities within the administrative structure of Germany As the name suggests, the Federal Republic of Germany (FRG) is a federal state comprising 16 states or Länder: eleven “old” Länder in West Germany (including Berlin) and five “new” Länder on the territory of the former German Democratic Republic (East Germany), which was united with the FRG in October 1990 (Press and Information Office of the Federal Government 1998: 7). Three of the old Länder – Berlin, Hamburg and Bremen – have the status of city-states, meaning that they are both Länder of the Federation and urban municipalities. German states possess “individuality of states”: they have their own constitutions, state territories and state powers with regard to legislation, administration and jurisdiction (Model et al 1997: 78 ff). The distribution of powers between the Federation and the Länder is laid down by the Basic Law, designed originally as a transitional substitute for a federal constitution (Schmidt-Bleibtreu & Klein 2004: 1 ff.). The Federation is the prime focus of legislative power. Federal legislative competence is either exclusive, concurrent, or for framework legislation (Model & Creifelds 2003:

GERMANY: THE MISMATCH BETWEEN NECESSITIES AND SOLUTIONS 93 133). By far the greatest part of executive powers is vested in the Länder. The relatively weak legislative powers of the Länder are offset by the Bundesrat, or Federal Council, composed of representatives of the 16 state governments, which participates in Federal legislation as the second chamber to the Bundestag, the Federal parliamentary assembly (Press and Information Office of the Federal Government: 147 ff). The administrative structure of the majority of the Länder has three levels: state authorities on the upper (departments) and middle (government districts, Regierungsbezirke) levels and local authorities on the lower level (Model & Creifelds 2003: 210). The latter are given a double function: lower level state administration and territorial authority with the power of local self-government. Article 28 of the Basic Law places responsibility for “all local community matters” in the hands of local government administrative units,1 namely Gemeinden,2 Städte (towns/cities) and Kreise (administrative counties).3 In keeping with the German administrative tradition, these units are hence the most important bodies entrusted with the performance of administrative functions. The structure and internal organisation of local government units are the responsibility of the Länder, so that there are great differences from state to state. However, the matters to be dealt with at the local government level are essentially the same. They are mostly determined by federal and state laws. Important local functions are the provision of the technical infrastructure, the creation and maintenance of social infrastructural, cultural and leisure facilities, local economic development, and environmental protection (Model & Creifelds 2003: 213). In the case of tasks exceeding local boundaries, local authorities are empowered to cooperate with adjacent cities and towns. The form of cooperation is determined by the individual states. 1.2. Local authority finances Of special relevance to local authorities’ scope of action are their financial means. The financial system of the Federation, the Länder and local authorities is organised as a compound or integrated system. The distribution of competences with respect to financial autonomy, legislative powers and tax revenues is laid down by articles 104 ff. of the Basic Law. The Basic Law distinguishes between taxes, the revenue of which goes exclusively to either the Federation or the Länder, and “shared taxes”, apportioned to the Federation, the Länder and in some cases the local authorities. The latter include income tax, corporation income tax, and turnover tax.4 These taxes provide the greatest part of the tax revenue accruing to the Länder. The tax pool formed by the Federation and the Länder and the related sharing of revenues from taxes and other charges is referred to as “vertical financial equalisation” (Model & Creifelds 2003: 182). The Basic Law also provides for horizontal financial equalisation among Länder that differ in financial strength (Model & Creifelds 2003: ibid).

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Local authority finances are integrated in the financial system of the Federation and the Länder, and are a complex conglomerate of taxes, levies, grants, and charges (Model & Creifelds 2003: 182). The most important taxes for the Gemeinden are the impersonal taxes (real property and business taxes) because of the volume involved and “because the local authorities can determine the level of these taxes autonomously by means of Hebesätze (municipal surcharge)”.5 In addition, they receive revenue from local “nuisance” taxes, namely excise and expenditure tax, the levying of which is at the discretion of the local authorities concerned. Since 1969 the Gemeinden have also been receiving a portion of the revenue from wages and income tax. These funds are distributed to local authorities on a fixed allocation basis in terms of the respective income tax proceeds. To compensate for this income tax allocation, local authorities pay a portion of their business tax revenues – also calculated to a fixed formula – to the Federation and the Länder.6 Government allocations, mostly made to local authorities by Land governments, are general or specific. Charges for the use of public facilities (user charges) or administrative services (administrative fees) are a further source of local authority income (Press and Information Office of the Federal Government: 160). For cooperation between core cities and their environs, the present system of local finances is often disadvantageous. Because of local autonomy in setting up their own Hebesätze and local authorities’ interest in high individual tax revenues, neighbouring cities and towns are, in the first place, competitors. Business and income taxes are powerful players to vie for. 1.3.

City-regions and urbanised areas

Given the large number of German cities, the number of urbanised areas is of course higher than the average European context. For the description of such areas, different terms are used in Germany: city-regions, urbanised areas, metropolitan areas, or agglomerations. Quite frequently these terms are used synonymously; at other times, they have precise and unique definitions. The term city-region, for instance, is used to describe an undefined area of core-cities and their environs. However, this term also stands for a differentiated model for the delimitation and structuring of urbanised regions with criteria based on the socio-economic framework (Lehmann-Grube 1983: 16, Duss 1997: 27). This model was developed at the end of the 1940s in the US to define Standard Metropolitan Areas (Lehmann-Grube 1983). In 1961, 68 city-regions around core-cities with more than 80,000 inhabitants each were counted in the Federal Republic of Germany (Boustedt 1970: 3207 ff.). The size of these regions ranged from the Rhine-Ruhr area with 9.4 million inhabitants to the Lüdenscheid area with fewer than 82,000 inhabitants. Criteria for delimitation included the “percentage of persons employed in agriculture in relation to all employed persons”, “population density”, “the share of persons commuting towards the urban core-area”, and “the absolute number of communities” (Boustedt 1970: 3207 ff.).

GERMANY: THE MISMATCH BETWEEN NECESSITIES AND SOLUTIONS 95 Significant changes with regard to social and economic framework conditions caused the abandonment of this approach in the 1980s; it was no longer practical (Duss & Stadtregion 1997: 27). In 1994 a working group of the Association of German Urban Statisticians (VDSt) presented a modified model for city-regions in the Federal Republic of Germany. “The fundamental differentiation … between core-areas and catchment areas was maintained” (Göddecke-Stellmann 1995: 200 ff.), as well as the size of core-cities with a minimum of 80,000 inhabitants. A crucial characteristic for delimitation of this reversed city-regions’ approach is the relationship between the core-city and surrounding localities with regard to the number of professional commuters. This approach led to 44 city-regions with a broad spectrum of population: from Rhein-Ruhr with nearly 12.5 million inhabitants to Neumünster with fewer than 140,000 inhabitants. Similar to city-region, terms like “metropolitan area” and “agglomeration” can be ambiguous. On one hand, they are frequently used synonymously and serve to describe large, urbanised areas. On the other hand, they have precise definitions based on certain criteria of size and density. In the late 1960s, 24 metropolitan areas (Verdichtungsräume) were fixed, some of which included several cityregions. Interestingly enough, some of these areas like Rhine-Ruhr or Stuttgart had also been classified as city-regions in the city-regions model (Boustedt & Müller 1970: 3215 and 3538). In autumn 1993 this approach was replaced by a new definition orientated to criteria like density, area and share of urban structures. The number of metropolitan areas now totals 45 (35 in West Germany, 10 in East Germany). The term “agglomeration-area” stands for “regions with large metropolitanareas” (Schön 1996: 361). Compared with the other terms under discussion it represents the largest regional category. Agglomeration areas are the 11 so-called metropolitan-regions (Metropolregionen) of Berlin-Brandenburg, Hamburg, RhineRuhr, Rhine-Main, Stuttgart, Munich, Halle/Leipzig-Sachsendreieck, HannoverBraunschweig-Göttingen, Nürnberg, Rhein-Neckar and Bremen-Oldenburg (Blotevogel 2005: 642). Note that, once again, the Rhine-Ruhr area, already classified as a city-region and a metropolitan-area, is numbered among the agglomeration areas. More serious than these uncertainties concerning definitions are the organisational and institutional problems brought up by these different categories when their political and administrative regulation is under discussion. A system of terms based on economic and demographic interconnections must interface with a close network of local authorities that is, for the most part, incompatible. Therefore it is not surprising that “the shaping of urbanized areas … was one of the most difficult and controversial areas” (Scheuner 1981: 115) in considerations concerning the territorial reform of the 1960s and 1970s. Despite all problems of definition and organisation, urbanised areas, which are often called “engines of economic development”, play a particular role in the present discussion on inter-municipal approaches for cooperation.

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(Source: Laufende Raumbeobachtung des Bundesamts für Bauwesen und Raumordnung (BBR), Bonn 2006)

GERMANY: THE MISMATCH BETWEEN NECESSITIES AND SOLUTIONS 97 Figure 2: Metropolitan areas in the Federal Republic of Germany

(Source: Laufende Raumbeobachtung des Bundesamts für Bauwesen und Raumordnung (BBR), Bonn 2005)

2. Decisive Necessities for Cooperation Demands concerning improved cooperation among cities, especially in the context of city-regions and metropolitan areas, are among the topics of local politics with cyclically returning relevance. The need for greater cooperation felt in recent years at the local government level in Germany is caused by a number of factors known from

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previous reform discussions. Among them are (Heinz 2000: 254 ff., Heinz et al 2004: 17 ff.):

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Fragmented local political and administrative structures resulting from lacking or inadequate territorial reorganisation. One example for the first is the so-called neue Länder, which comprised about 7,500 local authorities after the unification of Germany in 1990 (Damskis 1993). Another is that former territorial reorganisation of many city-regions in West Germany now results in discrepancies between established local authorities’ boundaries and extensive challenges and projects concerning economic development and transport planning or ambitious ventures with regard to technical or cultural infrastructure. Continual but uncoordinated enlargement of the built environment in the surroundings of core cities, and an ever closer functional interdependence between metropolitan entities (core-cities, old and new outlying communities, etc.), accompanied by significant changes with regard to the intra-regional distribution of uses. The division of functions of the 1960s and 1970s has given way to a successive functional similarity and thereby to a growing competition between core-cities and their environs. A growing financial divide between core-cities, suburbs and surrounding areas that threatens the overall development of urban regions and results from an uneven distribution of burdens, costs and revenues. High “centrality costs” (for the facilities of technical, social and cultural infrastructure and so on) collide with a drastic decrease of core-cities’ revenues because of a continuous and selective migration of urban residents and enterprises. This development is often characterised by the “fat belt” that encompasses core-cities. Along with these reasons for cooperation are a few new ones:

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The regionalisation of financial support at the supranational (EU), national, and state levels, which presupposes regional alliances (Kiepe 1999: 2). An inadequate and unequal position of city-regions with regard to negotiations with external (public and private) actors because of fragmented structures at the local level. Increasing and intensifying competition between cities in the course of globalisation and Europeanisation. The often confusing co-existence of different actors with differing competencies and responsibilities proves to be a serious disadvantage in this context. Deficits and inadequacies in existing cooperative approaches, including inadequate functional performance, obsolete boundaries, and lacking or indirect democratic legitimation for authority and activities.

According to a compilation of examples for cooperation published recently by the German Association of Cities, a central – if not the central – and current reason for cooperation is the tight financial situation of cities and local authorities. In order to ensure a further provision of services necessary for citizens, urban entities in financial straits are increasingly entering into cooperative alliances. The aim is to

GERMANY: THE MISMATCH BETWEEN NECESSITIES AND SOLUTIONS 99 bundle existing resources and ensure a more efficient use of personnel and equipment. To the fore are practical administrative tasks which range from the joint purchase of goods to common education activities or use of infrastructural facilities.7

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Types of Cooperation

The necessity of inter-municipal cooperation is by no means resulting in the establishment of adequate solutions. When it is about the regulation of a variety of problems and requirements and when a large number of actors is involved, the outcome is but a series of compromises. (The reasons for this are discussed in section 4.2.) At a first glance approaches to inter-municipal cooperation seem to be numerous, but a closer look reveals that they are made up of only a few recurring types. They differ from each other by the degree of institutionalisation, the scope of activities, and their organisational form. 3.1.1. Forms of cooperation not institutionalised under public law Informal approaches of cooperation. These include cooperative ventures like regional conferences (Regionalkonferenzen), networks and forums, all of which experienced a gain in importance in the 1990s because of a changing understanding of the public sector (Heinz 2000: 195. Regional conferences, first set up in NorthRhine Westphalia and Lower Saxony in the late 1980s, have been introduced in other Länder, too. Participants are the “relevant regional forces”, which nearly always comprise representatives from the local administration, the chambers of commerce, unions, and the scientific sector (universities, etc.). The work of regional conferences mostly concentrates on the discussion and development of the existing regional potential for economic development (Akademie für Raumforschung und Landesplanung 1995: 262). The main advantage of this approach is seen in long term motivation of the participants and an interactive process of opinion building. Criticism is spawned by the spatial limits of regional conferences, the selection of participants, the lack of democratic legitimacy, and the chosen topics. Networks and forums have been set up, often parallel to institutionalised forms of cooperation. They deal with questions of regional development and urban planning. These dialogue-oriented approaches allow for a flexible reaction to emerging problems and challenges, the integration of new participants, and the combination of regional/urban forces and the building of interactive structures (Weck 1996: 250). Potential disadvantages are attributed to the often dominant role of private sector actors and economic subjects, a lack of democratic control and legitimacy, and confinement to “feasible” challenges. 3.1.2. Cooperative approaches under private law. These approaches cover forms ranging from civil law associations to companies with limited liability, and are limited to areas and subjects outside the official powers of local authorities. They mostly occur in the fields of technical infrastructure or the promotion of

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economic development and tourism. Examples are the Rhein-Main-Abfall GmbH, an offshoot of the former Umlandverband Frankfurt, or the Wirtschaftsförderungs GmbH, established by the Verband Region Stuttgart (Steinacher 1998: 6). In companies with limited liability, the role of participating local authorities is that of shareholders or members. Their influence depends on the size of their capital contribution (majority of shares and voting rights) and the number and structure of other participants. Smaller local authorities especially understand this type of cooperation as a possible solution to their problems. Advantages are seen in the scope of formative action, administrative independence, and more rapid decision making. These potential advantages are offset by the contradiction of public and private sector interests connected with this approach, the reduction of local self-government because of partial privatisation and – similar to informal approaches – the lack of democratic control (Ehlers 1997: 141). 3.2. Institutionalised cooperation under public law This type of cooperation covers a wide range of associations, functional or territorial in approach, single- or multi-purpose in service provision. All approaches and cooperative ventures are based on the specific laws of the Länder in which they are implemented:

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Special-purpose associations are bound by laws on joint activities at the local level (Gesetze über kommunale Gemeinschaftsarbeit) or laws on special-purpose associations (Zweckverbandsgesetze) of the 13 bigger states (the so-called Flächenstaaten, i.e. not the three city-states). Neighbourhood associations in Baden-Württemberg are bound by the July 1974 state law on neighbourhood associations. Regional planning associations are based on the state planning laws of individual states (Landesplanungsgesetze) except that: ▲ Multisectoral approaches for cooperation, like the Verband Region Stuttgart or the former Umlandverband Frankfurt, require specific laws for individual cases; ▲ The establishment of new territorial authorities requires specific laws.

3.2.1. Associations concerning single-purpose cooperation. Besides “public agreements” (Öffentliche Vereinbarungen) (Deutscher Städtetag 1995: 12), these are associations confined to the implementation of specific tasks or ventures. They are public law entities with official powers concerning personnel, statutes and finances, whose members are mostly neighbouring local authorities. They do not possess territorial sovereignty. Single-purpose associations are in existence in all regions, urbanised or rural. Governing bodies are the association’s managers who are responsible for the performance of current duties; the association assembly consists of representatives of the association’s members. Representatives of participating local authorities are elected by the individual councils. According to the specific laws of German Länder on joint activities on the local level (Gesetze über kommunale Gemeinschaftsarbeit),

GERMANY: THE MISMATCH BETWEEN NECESSITIES AND SOLUTIONS 101 in some cases local representatives are subject to directives from their local authorities. The potential areas for activity are as broad as those in the purview of the local level. In practise, however, activities in the fields of technical and social infrastructure are foremost: the supply of drinking water and energy, management of sewage and garbage disposal, services in public sector transportation, and the maintenance of public facilities in the cultural and leisure sectors. In the course of the structural reform of the railway system and the resulting regionalisation of public transport in 1994, single-purpose associations have significantly gained in importance in this field. In a number of Länder, transport “pools” in the form of specific-purpose associations were set up. Most well-known and covering the biggest region (in a European context) is the Rhein-Main-Verkehrsverbund located in the Rhine-Main agglomeration (Rhein-Main-Verkehrsverbund GmbH 1994: 5). In some Länder, special-purpose associations are scheduled for specific activities by the respective Land laws: school associations in Saxony and environmental protection associations in Saarland (Deutscher Städtetag 1995: 14). According to existing evaluations, in many cases special-purpose associations are an appropriate legal form for specific inter-municipal tasks and problems. Concerning the implementation of individual activities, special-purpose associations indisputably provide advantages. A disadvantage connected with these approaches is a loss of competences for members of an association because the outsourcing of specific activities decreases direct democratic control and fragments local politicaladministrative structures (Heinz 2000: 5). 3.2.2. Territorial cooperation. Approaches for territorial cooperation are difficult to integrate into a typology. Moreover, their total number is quite small. No more than 20 associations are to be found in the 45 metropolitan areas of Germany. Apart from six neighbourhood associations (Nachbarschaftsverbände) in Baden-Württemberg and a number of associations responsible for regional planning, these cooperative approaches are unique. Their organisation, competences and territorial splits vary according to Land laws and the political and social framework in which they were introduced. Strong ties between these associations and local member authorities are provided for by the associations’ assemblies, which comprise representatives of the individual members of the association. Neighbourhood Associations (Wagener 1982: 416 f.). Following the territorial reform of the early 1970s, this type of association was introduced in six city-regions of Baden-Württemberg, joining six larger cities and their respective spheres of influence. Their main function is the preparation of joint land-use plans, and it is considered to be their main advantage, too. Criticism is expressed with regard to the minor competences of these associations concerning decision making and their spatial delimitation, which is not oriented to structural interconnections but rather to political factors. The main bodies of these associations are similar to those of special-purpose associations. The major difference is the composition of the representatives of the

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associations’ assemblies, which includes the heads of the participating local authorities’ administrations and other representatives elected by the councils of the associations’ members. Regional planning associations (Heinz, 211 f.). These associations were first established in Baden-Württemberg (12) and Bavaria (18). In other Länder, regional planning was assigned to specific state agencies. After the German unification, regional planning associations were set up in two of the new Länder (MecklenburgVorpommern and Saxony) as well. Regional planning associations cover the whole area of the individual Länder; therefore only in a few instances are they responsible for city-regions or urbanised areas. One well-known example is the Regionaler Planungsverband München. Members of regional planning associations are counties (Kreise) and cities independent from counties. According to Länder governments, regional planning associations are not only responsible for the formulation of regional planning and its goals but also for the coordination of sectoral planning. Despite its low management and control functions and its limited competences, the regional planning association in the Munich area is considered to be – aside from its function as a planning instrument – a worthwhile platform for dialogue between the city and its environs (Kegel 1995: 12). In spite of this, a long term goal of the Munich city government is to establish a multisectoral association similar to the one in the Stuttgart area (Verband Region Stuttgart). Multisectoral approaches for cooperation. Since the days of the territorial reform of the 1960s and 1970s, these approaches have played a dominant role in the debate of coordinating and managing the development of city-regions. In practise, only a few were set up, some of which have already been disbanded. Best known and often named a model for other city-regions is the Stuttgart Regional Association (Verband Region Stuttgart) (Heinz at al. 2004: 42 ff.). Set up in 1994, it was for a long time considered the most advanced development. Replacing the Nachbarschaftsverband Stuttgart, the Verband Region Stuttgart took over the mandatory functions of regional planning, conceiving and continuing the comprehensive landscape plan (Landschaftsrahmenplan), regional transport planning, waste disposal (certain sectors), and coordinating regional economic development and tourist marketing (Münzenrieder 1995: 44). The association is made up by the city of Stuttgart and five adjoining counties. One of its special features is that its main decision-making body, the regional assembly, is composed of directly elected members. Since the Verband Region Stuttgart has not been structured as an independent authority, it is – and this is one of its disadvantages – strongly dependent on its members. And furthermore most of its competences have to be shared with other actors on the local level. “Mixed competences – this is especially shown in the areas of garbage disposal and public transport – always result in frictional losses and inter-actor competition” (Steinacher 1988: 14).

GERMANY: THE MISMATCH BETWEEN NECESSITIES AND SOLUTIONS 103 Another city-region approach in the form of an association is the “Zweckverband Großraum Braunschweig” in the Brunswick (Lower Saxony) city-region (Plett 1993: 64 ff). It is a successor organisation to a more comprehensive multipurpose association established in 1978. Set up in 1992, it is responsible for public transportation planning and regional planning within its territory. In three other urbanised areas, existing multipurpose associations were disbanded and replaced by other forms of cooperation. The Umlandverband Frankfurt, for instance, which was established in 1974 and regarded as “probably the most advanced arrangement between a central city and its sphere of influence in the Federal Republic” (Münzenrieder, 43) was replaced in 2001 by a new construction, the Planungsverband Ballungsraum Frankfurt/Rhein-Main (Planungsverband Frankfurt Region Rhein-Main 2002). The competences of this organisation are not as comprehensive as its predecessor’s; they have been reduced to the formulation of the regional land use and landscape planning. A comparable development can be found in the Ruhr-area. The Siedlungsverband Ruhrkohlenbezirk (SVR), vested with numerous powers and competences and established in 1920, was replaced in 1979 by the Kommunalverband Ruhrgebiet (KVR) (Deutscher Städtetag 1995: 16 f). This association, the prime functions of which were in environmental protection and landscape conservation, was disbanded in 2004. The successor is called Regionalverband Ruhrgebiet (RVR)8 and marks the end of the successive transformation of multipurpose associations into regional planning associations. A different development has occurred in the Hanover region. Here the “Zweckverband Großraum Hannover” (Deutscher Städtetag 1995: 17f), an association mainly responsible for regional planning and public transport, was replaced by a new public authority, the Gemeindeverband Region Hannover. Multisectoral approaches for cooperation always face the same dilemma. They do not fit into the established political-administrative structures; coping with problems in city-regions and metropolitan areas therefore always requires an exceptional administrative organisation. Under specific political and personal constellations on local and Länder levels (because the Länder are responsible for passing specific laws for enacting such associations), the establishment of multisectorial associations was and is possible, usually with a broad range of activities and a regional assembly whose members are directly elected. But from the beginning of their existence, these associations have suffered from two restrictions: (1) they always have to share crucial competences like public transport or waste disposal with existing local authorities and (2) they are strongly dependent on levies because they do not have their own tax revenues. With changing political and personal constellations, changing overall conditions and the above-mentioned restrictions, multisectoral approaches for cooperation usually face two ways of developing: diminishing with regard to their competences and being replaced by a weaker organisation (examples are the developments in the Ruhr area, the Rhine-Main area and Brunswick), or establishing a stronger cooperative approach (as was done in the Hanover region).

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3.3. New public authorities The following forms of cooperation differ from the above mentioned associations with regard to two main aspects: they are territorial authorities on the local level and they dispose of their own revenues. Other characteristics like the democratic legitimacy of their decision-making bodies or multipurpose orientation are the same as in some of the multipurpose associations. The formation of new territorial authorities can be effected in two different ways: amalgamation of existing local authorities accompanied by a dissolution of the old entities or joining together into new territorial authorities with retention of existing entities. The first approach – amalgamation – is here mentioned for systematic reasons, but it does not stand for a specific form of cooperation: the former cooperants no longer exist; they have been amalgamated. This is also true for the Regionalstadt approach. In contrast, the second approach not only belongs to the cooperative ventures mentioned in this section but also stands for the strongest form of cooperation: the establishment of a new public authority with its own political and administrative competences and responsibilities (apart from the continued existence of its member local authorities). Amalgamations have played a significant role in the course of the territorial reform of the 1960s and 1970s in West Germany. The total number of localities was reduced from 24,278 to 8,514, the number of administrative districts (Kreise) from 425 to 235 (Thieme et al. 1981: 77 ff). The core-cities of urbanised areas profited from this reform only in a few cases, such as North-Rhine Westphalia. In the majority of the West German Länder, the big cities did not get much from this reform (Seele 1983: 87 f). After the unification, municipalities in East Germany totalled 7563 (in 1993), 47 percent of which had fewer than 500 inhabitants (Damskis 1993: 13). A reform corresponding to the one effected in West Germany was therefore also implemented in East Germany. 3.4. Territorial authorities and innovative approaches Since the territorial reform of the 1960s and 1970s, the debate about better coordination and management of urbanised areas is always accompanied by the same proposals aiming at the establishment of two region-wide territorial authorities: regional city (Regionalstadt) and regional county (Regionalkreis). Both these approaches have remained proposals. The Municipal Authorities of Saarbrücken and Hannover are oriented to the Regionalkreis model but do not have all of its components. Stadtverband Saarbrücken (Saarbrücken Territorial Authority). The Stadtverband Saarbrücken was set up in 1974 as successor to an administrative district (Kreis) with the same name. Until the establishment of the Region Hannover it was the only

GERMANY: THE MISMATCH BETWEEN NECESSITIES AND SOLUTIONS 105 city-region association in Germany which was structured according to the county model (Lehmann-Grube, 65). The Stadtverband Saarbrücken therefore exercises all the functions of a Saarland Landkreis. It is also responsible for land-use planning and comprehensive development planning for its territory. Gemeindeverband Region Hannover (Territorial Authority Region Hannover). The Region Hannover authority (Priebs 2002: 144 ff) was established in 2001 as a successor to the former Zweckverband Großraum Hannover. The authority comprises the core-city Hannover and 20 adjoining cities and municipalities. Its activities cover a broad spectrum: regional planning, public transport, infrastructural and social affairs, hospitals and vocational training. Having its own taxes and revenues, which were in the original proposal for this approach, could not be realised; this would have required an amendment of the Basic Law. Observers see the main advantages of this approach in its territorial arrangements matching the problems of the area, its logical development from former approaches, and the fact that its implementation creates very few losers (Fürst 1996: 283). Regionalstadt (Trute 1997: 21). The regional city approach was suggested for the first time at the beginning of the 1970s in the Rhine-Main area, when its then-Mayor Möller wanted to establish a “Greater Frankfurt” local authority. The objective of this approach was to render functional interconnections and the administrative area as harmonious as possible. Existing counties and local authorities would be dissolved and become part of the new regional city, which would be provided with official powers for finance, personnel and planning, and be responsible for all important tasks of planning and structure within its territorial borders. Among all the reform approaches proposed in the course of the city-region discussions, the Regionalstadt model is the most radical. It therefore was and is confronted with the firmest resistance. Regionalkreis (regional county). This approach was under discussion in the RhineMain area in the 1970s and 1990s, in the Stuttgart region in the 1990s, and currently seems to have a chance of being realised in Mecklenburg-Vorpommern, where the Land government wants to organise a structural reform of the public administration, part of which is an amalgamation of hitherto county-free cities and counties into four in the meantime five regional counties (Mecklenburg-Vorpommern 2003). Unlike the Regionalstadt model, in this cooperative approach cities and municipalities within the territory of the new entity remain in existence; only the core-city loses its county independence. The Regionalkreis has competence for all planning, implementation and financial activities with regional relevance. A special advantage is seen in the fact that this approach does not only fit into existing administrative structures, but also contributes to a simplification of these structures because of the dissolution of state middle-tier administration (Regierungspräsidien) (Heinz et al. 2004: 156).

In principle all forms of organizations under private law, mostly companies with limited liability

Acceleration with regard to decisions, high scope of formative action, administrative independence

Need for discussion and information with regard to regional problems; need for common development guidelines

High ranking Local authorities representatives from local administration and governments of the Länder as well as economic actors (concerning forums)

Stimulating factors for cooperation

Initiators, main actors responsible with regard to introduction

Neighborhood Associations

Local and municipal authorities as well as responsible Landauthorities: dependent on specific tasks Land-government of Baden-Württemberg

Problems and Problems between corechallenges transcending cities and their local boundaries; surroundings linkage of competences; enhancement of efficiency

Public agreements (p.a.) and Associations confined to the implementation of specific tasks (s.t.a.)

Neighborhood Associations

Territorial cooperation

Cooperations institutionalized under public law

Cooperative approaches Organizations under private law concerning specialpurpose cooperation

Regional conferences, networks, forums

Characteristics Name

Informal cooperative approaches

Types of Forms of cooperation not institutionalized under cooperation public law

Growing functional interdependences between core-cities and surrounding municipalities; securing a coordinated development within the association’s territory

“Verband Region Stuttgart” and „Zweckverband Großraum Braunschweig“. „Umlandverband Frankfurt“, „Kommunalverband Ruhrgebiet“ and „Zweckverband Großraum Hannover” were replaced by other organizations

Governments of several Responsible Länderof the German Länder governments

Supra-local regional planning in the context of one Land; coordination of sectoral planning;

Regional Planning Associations

Regional Planning Associations

Multisectoral approaches for cooperation

Table 1: The most important forms of interlocal cooperation in German city-regions9

Governments of the German Länder

Territorial reforms in West- and EastGermany; discrepancies between the boundaries of established local authorities and existing social-economic interdependencies

Mergers, amalgamation of adjoining local authorities

Amalgamations

New public authorities

Länder-governments and – in the case of Hanover – representatives from the local level

Territorial reforms; structural integration within the metropolitan area (S); interregional competition, uneven distribution of burdens, costs and revenues between the local authorities in the metropolitan area (H)

Saarbrücken municipal authority (S); “Region Hannover” (H) as well as innovative approaches like “Regionalstadt” and “Regionalkreis”, both of which have not been realized up to now

Municipal authorities

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Especially activities in the field of technical infrastructure; no competences as to the official powers of local authorities

In companies with limited liability: shareholders and shareholders’ assembly

Public and private actors

Not fixed, dependent on the given actors

Relevant public and private „regional forces“, heads of local administrations, representatives of organized interest groups

Organizational Structure

Participants

Especially local authorities and municipal authorities

Association’s assembly (representatives of the members of the association) and head of the association (s.t.a.), responsible institutions of the members, executive forces of one or of all participating local authorities (p.a.)

Potentially all activities in the responsibility of the local level; dominance of activities in the field of technical infrastructure and big projects of the public sector

Six larger cities in Baden-Württemberg and their surrounding localities

Association’s assembly (representatives of the members of the association) and head of the association

Preparation of joint land-use plans; further competences may be attributed

Neighborhood Associations

Territorial cooperation

Cooperations institutionalized under public law

Cooperative approaches Organizations under private law concerning specialpurpose cooperation

Broad sectoral spectrum, dominance of economic questions; main areas of work reach from analytical tasks to the formulation of strategies and activities

Characteristics Fields of activities

Informal cooperative approaches

Types of Forms of cooperation not institutionalized under cooperation public law

Broad spectrum of activities in the “Verband Region Stuttgart” and the former “Umlandverband Frankfurt”; regional planning and public transport with regard to the “Zweckverband Großraum Braunschweig” and its former counterpart in the Hanover region

Multisectoral approaches for cooperation

Counties (municipal authorities) and independent (countyfree) cities; in Bavaria as well as countydependent local authorities

Counties and independent (countyfree) cities within the association’s territory

See: Neighbourhood Association’s Associations; additional assembly, association’s actors in Bavaria committee and director of association (KVR, Hannover and Braunschweig) as well as chamber of the local authorities (UVF, because of the formulation of the landuse plan); regional assembly and two headed leadership (Stuttgart)

Regional planning; additional activities may be transferred

Regional Planning Associations

Core-cities and surrounding localities or a number of neighbouring local authorities

The political administrative structures fixed in the local authorities’ constitutions of the individual German Länder

All activities within the responsibility of local authorities

Amalgamations

New public authorities

Core-city as well as nine other-cities in the case of Saarbrücken (S); Hanover and the cities and localities belonging to the Hanover county (H)

According to the administrative district model: council, committee and president of the municipal authority; in addition planning council because of land-use plan formulation (S); regional assembly, -committee, and -president as well as chamber of local authorities (H)

Formulation of the landuse plan for its territory, all the functions of an administrative district (Landkreis), duties of a lower administrative authority of the Land (S); broad spectrum of activities within its own scope of action and the one assigned by the Land, regional planning as well as several operative functions (H)

Municipal authorities

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Indirect democratic control because of the representatives of local authorities in the association’s/company’ s assembly

Members appointed by participating institutions, no democratic legitimacy

Starting from NorthRhine-Westphalia and Lower Saxony now in existence in a number of German Länder (regional conferences); in a number of metropolitan areas (networks and forums)

Democratic control

Frequency

Indirect democratic legitimacy (members of associations’ assemblies elected by local councils, s.t.a.)

Territory of the participating authorities

Six associations in Baden-Württemberg

Indirect democratic legitimacy (only of some of the members of the associations’ assemblies)

Territory of core-cities and their surrounding localities

Fees, contributions, Associations’ levies levies (s.t.a.), free arrangements with regard to the distribution of costs and revenues (p.a.)

To an increasing degree High numbers of approaches in all of the bigger German Länder (this goes especially for special purpose associations)

Task-specific

Capital investment of the shareholders

Metropolitan areawide; dependent on specific tasks and actors

Land subsidies (in the case of regional conferences) and financial means of the participants

Neighborhood Associations

Territorial cooperation

Cooperations institutionalized under public law

Cooperative approaches Organizations under private law concerning specialpurpose cooperation

Spatial cut

Characteristics Finances

Informal cooperative approaches

Types of Forms of cooperation not institutionalized under cooperation public law

38 regional associations in four of the German Länder: BadenWürttemberg, Bavaria, MecklenburgVorpommern, Saxony

See: neighborhood associations

Territorial boundaries of the associations’ members

Associations’ levies as well as subsidies and grants from the individual Länder

Regional Planning Associations

Table 1 (Continued)

5 associations in the metropolitan areas of 4 Länder (3 of these associations have been replaced by other forms of cooperation)

Indirect democratic control (delegates from the councils of the associations’ members); directly elected representatives in the cases of Stuttgart and the former UVF in the Frankfurt area

Territorial boundaries of core-cities and surrounding counties (with the exception of the former UVF)

Levies of the associations (with differing grounds for calculation) and fees (as well as Land grants in the case of the “Verband Region Stuttgart”)

Multisectoral approaches for cooperation

Several thousands in all German Länder: in West-Germany between 1967 and 1977, in East-Germany starting from 1993

Election of the members of the local councils

Territorial boundaries of the amalgamated local authorities

Taxes (property- and business taxes), fees and contributions

Amalgamations

New public authorities

Two municipal authorities in the city regions of Saarbrücken and Hanover

Election of the members of the metropolitan area council (S) and of the regional assembly (H)

Territorial boundaries of the members of the municipal authority (S); boundary of the former “Kommunalverband Großraum Hannover” (H)

Levies, allocated contributions of the Land and grants (S and H) as well as additional tax revenues (H)

Municipal authorities

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GERMANY: THE MISMATCH BETWEEN NECESSITIES AND SOLUTIONS 109 4. Considerations Concerning the Implementation of Cooperative Approaches 4.1. Predominant types of cooperation By juxtaposing the different forms of cooperation it becomes evident that intermunicipal cooperation in German city-regions in recent years has been characterised by a clear increase in differently shaped informal approaches as well as a high number of single-purpose associations. Both these approaches – this is always stressed by their advocates – are relatively easy to set up and to design for a particular situation (Heinz 2000: 205). Theoretical assistance for these approaches is provided by the debate on neo-liberal reforms and the concepts of new public management and public choice.10 With regard to informal approaches, it is moreover emphasised that they dispose of an atmosphere of consensus when dealing with win-win situations. Quite often what is left aside is that these approaches mostly concentrate on clearly defined regions with local authorities similarly structured and on largely uncontroversial, “soft” activities and problems, which do not touch critical issues like the distribution of finances and costs or the responsibilities of established institutions and organisations. And some other characteristics are left out of consideration: a decline in democratic control through the transfer of public functions to nonlegitimised cooperative bodies and a further fragmentation of politicaladministrative structures in metropolitan areas and conurbations (Rautenstrauch 1999: 21 f.). Quite often these structures are characterised by an increasingly bewildering tangle of municipalities, governmental and regional organisations and institutions, as well as public, private, or informal cooperative approaches with differing actors, functions, and jurisdictions. Although the need for coordination in city-regions and metropolitan areas is widely recognised and repeatedly advocated, area-wide approaches orientated towards coordination and cooperation are comparatively rare in Germany. If we omit neighbourhood and regional planning associations responsible for the formulation of land use and regional plans, then only a small number of areas have actually implemented multisectoral approaches for cooperation. Mostly these are city-regions of economic relevance facing strong competitive pressure at national and international levels. 4.2. Decisive factors in the implementation of adequate strategies for cooperation The gap between the need for adequate strategies in city-regions – reiterated in German city-regions since the territorial reform of the late 1960s and early 1970s – and their realisation is large. But why? Why, in many instances, is it so difficult to translate the necessity for cooperation into an adequate strategy? Is it justified by shortcomings with regard to the proceedings? Is it based upon the manner reforms are designed and implemented? In the majority of cases, the reasons for this mismatch have to be sought elsewhere, and they are mostly based on structural grounds:

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The existing structures of individual Länder. The integration of innovative approaches for the coordination and management of city-regions is always

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difficult because the approaches and existing structures do not fit to each other.11 The political-administrative structures on the local level. In a region like Hannover, for instance, where only one county encloses the core-city, a region-wide reform seems easier to implement than under conditions where core-cities are surrounded by five or more different counties (like the regions of Stuttgart and Rhine-Main). The relevant actors and decision makers for the implementation of cooperative approaches. Because of their different and often conflicting interests, they can promote or prevent the realisation of these approaches.12 Inter-municipal cooperation to a high degree is therefore a reflection of the existing constellations of actors, their specific interests, and compromises realised between proponents and opponents.

Initiators and proponents. On the side of initiators and proponents especially, actors may be found who expect specific benefits from the new approaches. Despite all differences and peculiarities of individual cases, four groups can be distinguished (Heinz 2000: 10 ff.):

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Core-cities and their political representatives. In the majority of cases these are the Mayors or Lord Mayors (Oberbürgermeister). In periods of economic prosperity, they are mainly opposed to cooperative approaches. However, untoward economic conditions – losses of jobs, economic demand, population, and revenues – coupled with the high cost of providing core-city services and the requirements of increasing national and international competition often bring about a change of mind. In several cooperative approaches, core-cities and their political representatives have played a crucial role; examples extend from Frankfurt and Stuttgart to the Hannover and Berlin areas. Industry and commerce and their actors. From an economic point of view, fragmented decision-making structures and competences are counterproductive because of complicated regulatory structures. They render investments and projects more difficult and, according to critical observers, reduce the influence of relevant economic actors over public sector politics in city-regions. Therefore associations of industry and commerce strongly advocate a simplification of political and administrative structures. In many instances, their organisations are already regionally-based and so they are not restricted to the boundaries of individual local authorities. In the RhineMain area in 1991, for instance, the parting shot for an intensive debate on cooperative approaches was given by the Chamber of Industry and Commerce with the staging of the “Rhine-Main Forums” (Heinz 1997: 91). With some reservations, the Länder. In many cases they take a rather ambivalent position. They assist and promote cooperative approaches as long as they do not get too strong and thereby become competitors. This has been evident recently in Länder like Hesse, North-Rhine Westfalia and Baden-Württemberg. In the latter state, government and state parliament

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always (that is since the 1970s) opposed the development of strong cityregions and – this goes for innovative approaches in the Stuttgart area – the existence of a capital which is too big, too strong, and too influential (Heinz et al. 2004: 184). Professionally involved actors and media with specific objectives and interests. These range from transparent and more effective administrative structures to new employment opportunities (in case of freelance planners and consultants) or new sales and advertising markets (in the case of local media). In the debate of new approaches to cooperation in the Rhine-Main area in the early 1990s, the leading dailies, Frankfurter Allgemeine Zeitung (FAZ) and the Frankfurter Rundschau, played an important role (Heinz, 92). The same happened in the Stuttgart area with the newspapers Stuttgarter Nachrichten and the Stuttgarter Zeitung in 2002 and 2003.

Opponents and Critics. The side of opponents and critics of comprehensive cooperative approaches is made up of organisations and institutions as well as residents’ groups, who are afraid of certain disadvantages and losses resulting from the establishment of cooperation. Once more, with some simplifications, four groups may be distinguished (Heinz 2000: 11 ff.):

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Middle-tier Land administrative authorities (Regierungsbezirke) and existing associations of local authorities (Landkreise). These public sector entities are usually among the strongest opponents of cooperative approaches because, especially when the establishment of new territorial authorities is involved, they fear a drastic loss of competences and power. Suburban governments and local authorities adjacent to core-cities. Their resistance is the strongest when annexations or amalgamations of local authorities are under discussion. These entities together with their key officials and representatives are afraid of losing power, influence, and functions, not to mention finances because of the obligation to share the high costs of services provided by core-cities. Urban residents and population groups. For the most part, urban residents identify themselves with the local authorities or districts they live in. Their sense of belonging to a city-region and their interest in area-wide politicaladministrative structures are, for the most part, negligible. They often oppose the realisation of administrative reforms within city-regions because they fear a loss of democratic control, a greater distance to “their” administrative institutions, and also a loss of local identity. Sometimes opponents can be found among high-income residents from the suburbs, who are afraid of a looting of their budgets, a loss of administrative efficiency and a share of responsibility with regard to the problems of core-cities. The experts. These do not display general opposition to inter-municipal cooperative approaches so much as ideologically motivated criticism of certain forms of cooperation. For example, advocates of the public choice approach reject strong comprehensive cooperative approaches as cumbersome and no longer up to date, and vote for informal networks of inter-municipal agreements. On the other side, proponents of strong and region-wide ap-

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4.3. Forms of area-wide cooperation and their prerequisites When the assumption proves to be right – that approaches of area-wide cooperation are blocked by established political-administrative structures and actors interested in the preservation of these structures – then we need to ask about the conditions in which those few cases of cooperative approaches were successfully implemented. What were the prevailing political-administrative structures? What was the composition of relevant actors? According to existing studies, the following factors played a high role in the realisation of area-wide approaches in German city-regions:

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A small number of actors (of different interests) on the local level. This was the case in the region of Hannover; the core-city was surrounded by only one county. Spatial identity of existing cooperative approaches and new forms of cooperation. Hannover is an example here, too. The former metropolitan association of Hannover, the surrounding county of the core-city, and the new cooperative approach all have the same borders (Heinz 2000: 240). Support or pressure from the states. This was the case in Rhine-Main area, when the former Umlandverband Rhein-Main was established in 1975 Heinz & Reidenbach 1997: 36), and in the Stuttgart area, when the state government enacted the Verband Region Stuttgart in 1994 (Heinz et al. 2004: 41). Support from core-city mayors. Examples are the regions of Hannover, Stuttgart and Rhine-Main. Engagement and involvement of specific high-ranking individuals of the public sector (Heinz 2000: 239). Significant pressure, especially economic. This was the main reason that the Prime Minister of Baden-Württemberg in 1991 installed a group of experts to draw up a proposal for the improvement of cooperation within the Stuttgart region (Mecking 1995: 332).

All these factors have played an important role with regard to the implementation of a few innovative approaches for cooperation. But their existence alone does not seem to be sufficient. It always requires a specific combination of some of these factors, a specific setting of political-administrative structures on different levels, and a specific economic background. 5. Concluding Remarks In some German city-regions like Rhine-Main and Stuttgart some reform-oriented considerations have recently been made that are similar to the Gemeindeverband Region Hannover: This is a turning away from the mainstream of informal and

GERMANY: THE MISMATCH BETWEEN NECESSITIES AND SOLUTIONS 113 small-scale cooperative approaches to the introduction of comprehensive solutions with coordinating powers on a regional level. In the Rhine-Main area, for instance, amalgamations are called for by representatives of the city of Frankfurt, and the mayor votes for the introduction of a Stadtkreis (city-county);13 in some of the city-regions of Baden-Württemberg, there is debate on new territorial authorities in the form of regional counties (Drexler 2003:1). But, as in former times, these considerations have strong resistance from existing municipal associations (Landkreise), suburban authorities, and Länder governments (Heinz et al. 2004: 184). The assumption seems to prove right – and this is evidenced by some recent developments in metropolitan areas – that suboptimal solutions will prevail in the future: informal and win-win oriented forms of cooperation, and single-purpose associations. As a consequence of administrative reforms and increasing financial hardship at the local level, these approaches will additionally gain in importance. But there may be a chance for another development, too. Perhaps the often heard call for strong cities and regions (Deutscher Städtetag 1999) in an enlarging European Union will result in the establishment of strong territorial authorities, not only within metropolitan areas, but in other regions, too. The consequence could be the establishment of territorial authorities like Regionalkreise, amalgamations, and new cooperative associations. Such a reform could be accompanied by a rejection of the principle of “standardisation of the administration”, and could allow for regionspecific approaches that fit the structures and constellations of individual regions. And such a reform – shown by the development in North-Rhine Westphalia after the territorial reform of the 1970s14 – does not mean a reduction in or the end of local self-government; it only means – and this is for sure – a cutback of functions, positions and mandates, the holders of which have always proved resistant to changes.

References Akademie für Raumforschung und Landesplanung (Ed.) (1995). Zukunftsaufgabe Regionalplanung. Anforderungen – Analysen – Empfehlungen, Hannover. Blotevogel, H.H. (2005). Metropolregionen, in: Akademie für Raumforschung und Landesplanung (Ed.), Handwörterbuch der Raumordnung, Hannover, p. 642–647. Boustedt, O. (1970). Stadtregionen, in: Akademie für Raumforschung und Landesplanung (Ed.), Handwörterbuch der Raumforschung und Raumordnung, Hannover. Damskis, H. (1993). Zur Entwicklung der kommunalen Gebietsreform in den neuen Bundesländern, Berlin (Difu-Materialien 11/93). Deutscher Städtetag (Ed.) (2003). Statistisches Jahrbuch Deutscher Gemeinden, 90. Deutscher Städtetag (Ed.) (1999). Stärkt die Städte in Europa, in: Neue Schriften des Deutschen Städtetages, 77. Deutscher Städtetag (Ed.) (1995). Entwurf eines Arbeitspapiers zum „Interkommunalen Handeln in der Region“, Manuscript, Köln 19.10.1995. Drexler, W. (2003). Verwaltungsreform: Mehr Bürgernähe – mehr Effizienz – weniger Bürokratie, in: Klartext, 1, p. 1. Duss, R. (1997). Die Stadtregion – ihre Bedeutung für die regionale Zusammenarbeit in den städtischen Regionen, in: Stadtforschung und Statistik, I, p. 19–31. Ehlers, D. (1997) Interkommunale Zusammenarbeit in Gesellschaftsform, in: Deutsches Verwaltungsblatt, 3, p. 137–145. Emig, D. & Hermann, R.A. (1996) Regionenfieber? Probleme und institutionelle Formen der interkommunalen Zusammenarbeit, in: Fachzeitschrift für Alternative Kommunal Politik – AKP, 6, p. 37–39.

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Fürst, D. (1996) Region Hannover – Aufbruch zu neuen Ufern?, in: Niedersächsischer Städtetag – Nachrichten, 12, p. 283–284. Gesetz über den Regionalverband Ruhr, Gesetz- und Verordnungsblatt Nordrhein-Westfalen, No. 6, 20.2.2004. Göddecke-Stellmann, J. (1995) Die Stadtregion – ein neues Abgrenzungsmodell, in: Verband Deutscher Städtestatistiker (Ed.), Jahresbericht 1995, p. 200–210. Heinz, W. et al. (2004). Interkommunale Kooperation in baden-württembergischen Stadtregionen, Berlin. Heinz, W. (Ed.) (2000). Stadt & Region – Kooperation oder Koordination? Stuttgart, Berlin und Köln. Heinz, W. (2000). Interkommunale Kooperation in Stadtregionen: das Beispiel der Bundesrepublik Deutschland, in: Werner Heinz (Ed.), Stadt & Region – Kooperation oder Koordination, Berlin, p. 169–274. Heinz, W. (1997). Ansätze interkommunaler Kooperation: Frankfurt und die Rhein-Main-Region, in: Archiv für Kommunalwissenschaften, I, p. 73–97. Heinz, W.& Reidenbach, M. (1997). Intraregional Cooperation in Metropolitan Areas, Frankfurt and the Rhine-Main Area, Manuscript, Köln. Innenministerium Mecklenburg-Vorpommern (Ed.) (2003) Eckpunkte zur Reform der öffentlichen Verwaltung, Schwerin. Kegel, F. (1995). Umland fürchtet Politik des goldenen Zügels, in: Demokratische Gemeinde, 9, p. 12. Kiepe, F. (1999). Die Region als Dach für die kommunale Kooperation – Zur Notwendigkeit von Stadtregionen, in: Eildienst, Städtetag Nordrhein-Westfalen, 1/2, p. 2–5. Lehmann-Grube, H. (1983). Die Verwaltung von Stadtregionen in der Bundesrepublik Deutschland, in: H. Lehmann-Grube und G. Seele, Die Verwaltung der Verdichtungsräume, Baden-Baden, p. 9–67. Mecking, Chr. (1995). Die Regionalebene in Deutschland, Stuttgart et. al. Model, O. & Creifelds, C. (Eds.) (2003). Staatsbürger-Taschenbuch, 31. Auflage, München. Model, O. & Creifelds, C. (Eds.) (1997). Staatsbürger-Taschenbuch, 29. Auflage, München. Münzenrieder, H. (1995). Stadt-Umland-Verbände als kommunale Regelinstitutionen, in: Bayerisches Verwaltungsblatt, 2, p. 42–46. Planungsverband Frankfurt Region Rhein-Main (Ed.) (2002). Planungsverband Region Rhein-Main, Manuscript, Frankfurt. Plett, A. (1993). Neugründung mit Problemen, in: Kommunalpolitische Blätter, 1, p. 64–66. Press and Information Office of the Federal Government (Ed.) (1998). Facts about Germany, Frankfurt/Main. Presse- und Informationsamt der Stadt Frankfurt am Main (Ed.) (1971). Regionalstadt Frankfurt, Ein Beitrag zur Diskussion, Frankfurt. Priebs, A. (2002) Die Bildung der Region Hannover und ihre Bedeutung für die Zukunft stadtregionaler Organisationsstrukturen, in: Die Öffentliche Verwaltung, 4, p. 144–151. Rautenstrauch, L. (1991). Organisation der Region, in: Akademie für Raumforschung und Landesplanung (Ed.), Großstadtregionen in Deutschland vor dem Hintergrund europäischer Entwicklungen, Hannover, p. 21–26. Rhein-Main-Verkehrsverbund GmbH (Ed.) (1994). Regionalisierung des Nahverkehrs, Modellprojekt, Rhein-Main-Verkehrsverbund, Hofheim, RMV-No. 3. Scheuner, U. (1981) Voraussetzungen der kommunalen Gebietsreform, in: G. Chr. von Unruh, W. Thieme und U. Scheuner, Die Grundlagen der kommunalen Gebietsreform, Baden-Baden, p. 57–127. Schmidt-Bleibtreu, Bruno and Franz Klein (Eds.) (2004), Kommentar zum Grundgesetz, 10th edition, München. Schön, K.P. (1996) Agglomerationsräume, Metropolen und Metropolregionen Deutschlands im statistischen Vergleich in: Akademie für Raumforschung und Landesplanung (Ed.), Agglomerationsräume in Deutschland, Hannover, p. 360–401. Seele, G. (1983) Verwaltungsorganisation in Großstadtregionen, in: H. Lehmann-Grube & G. Seele, Die Verwaltung der Verdichtungsräume, Baden-Baden, p. 69–230. Stadtkreis – Idee bekommt neuen Schub, in: Frankfurter Rundschau, 18.10.2003. Steinacher, B. (1998). Stärkung der Zusammenarbeit durch den Verband Region Stuttgart, Manuscript, Stuttgart. Thieme, W. & Prillwitz, G.(1981) Durchführung und Ergebnisse der kommunalen Gebietsreform, BadenBaden. Trute, H-H. (1997). Institutionelle Möglichkeiten zur Lösung von Stadt-Umland-Problemen, in: Die Neue Verwaltung, 1, p. 20– 23.

GERMANY: THE MISMATCH BETWEEN NECESSITIES AND SOLUTIONS 115 Unruh, G. Chr. von, Thieme, W. and Scheuner, U. (1981). Die Grundlagen der kommunalen Gebietsreform, Baden-Baden. Wagener, F. (1982). § 39, Stadt-Umland-Verbände, in: Handbuch der kommunalen Wissenschaft und Praxis, Berlin, Heidelberg und New York, p. 413–430. Weck, S. (1996). Neue Kooperationsformen in Stadtregionen, in: Raumforschung und Raumordnung, 4, p. 248–256.

Notes 1

See: Grundgesetz, Article 28, in: Schmidt-Bleibtreu & Klein: 16. The basic unit of local government in Germany, referring to both rural and urban authorities. 3 The German Landkreise are local government associations (Gemeindeverbände) which possess the right of local self-government. Their territory stands at the same time for the district of a lower Land administrative authority. The administrations of Landkreise have therefore a dual function: they are responsible for carrying out local self-government functions performed in their own right and carry out functions delegated by the Land (übertragene staatliche Verwaltungsaufgaben). 4 See: Grundgesetz, Article 106, in: Schmidt-Bleibtreu & Klein: 40 ff. 5 Ibid. 6 See: Grundgesetz, Article 106, in: Schmidt-Bleibtreu & Klein: 40 f. 7 See the present endeavours of some cities of the Ruhr-area under the term “Cooperation and Selfinterest”. 8 See Gesetz über den Regionalverband Ruhr, Gesetz- und Verordnungsblatt Nordrhein-Westfalen, No. 6, 20.2.2004. 9 Derived from a compilation in: Werner Heinz (2000: 226 ff). 10 The New Public Management approach aims at improving the efficiency of the public sector by introducing elements and principles of the private sector such as client orientation, market orientation, decentralisation with regard to functions and resources etc. Comprehensive coordination and planning as well as integrated cooperation are considered to be centralistic and bureaucratic. It goes without saying that this concept is well matched with single-purpose cooperation and does not fit with comprehensive and extensive cooperative approaches. 11 According to Frido Wagener, “The political-adminstrative management of the problems of city-regions and metropolitan areas always requires unusual solutions”. 12 Jörg Jordan, a former member of the Hesse government, said during a reform debate in the mid 1990s that innovative approaches “get stranded in the barrage fire of local political interests” (quoted in Frankfurter Rundschau, 18.2.1995). 13 See Stadtkreis, Idee bekommt neuen Schub in Frankfurter Rundschau, 18.10.2003. 14 In the course of the territorial reform between 1964 and 1978, the number of local authorities in North Rhine-Westphalia was reduced from 2362 to 396 (Thieme & Prillwitz 1981: 409). 2

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CHAPTER 6 MARCELLO FEDELE & GIULIO MOINI*

ITALY: THE CHANGING BOUNDARIES OF INTER-MUNICIPAL COOPERATION

In Italy, inter-municipal cooperation has to face the historical fragmentation of the political and administrative system of local authorities. The country is essentially formed of small – and extremely small – municipalities (communi) that were, in the 1990s, required to tackle very important administrative and constitutional reforms and crucial policy changes in different sectors of public policy. As a consequence, Italian local authorities assumed leadership in the functioning of the political system. But in this role they encountered a significant obstacle: the fragmentation of Italian municipalities. The progression of inter-municipal cooperation is becoming an important, operative solution. In this chapter, after a short reconstruction of the historical origins of the problem of Italian intercomunalità (section 1), we will describe the main variables explaining the growing need for inter-municipal cooperation during the 1990s (section 2). The next section will develop a model showing the different forms of inter-municipal cooperation described from an institutional and organizational perspective (section 3). The forms shown in the model will be analyzed according to their regional differences (section 4), bringing us to various conclusions (section 5) and enabling us to identify possible different development perspectives for intercomunalità in Italy. 1. The Historical Perspective If Italian municipalities today engage in more permanent forms of, a long story is behind it and at least two aspects deserve consideration. The first concerns the persistent problems associated with the demographic size of municipalities occurring from the time of national unification in 1860 to the early 1990s. The second is the delay in *

Even if this contribution has been jointly set up by the two authors, Marcello Fedele has written section 1 and 4, Giulio Moini has written section 2, while sections 3 and 5 have been written in co-operation R. Hulst and A. van Montfort (eds.), Inter-Municipal Cooperation in Europe, 117–138. © 2007 Springer.

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tackling the restructuring of local governments in Italy vis-à-vis other European countries. Whether European countries now use an Anglo-Saxon or a continental type of administrative tradition, their relationship between public policy and territorial organisation was driven by the promotion of governmental responsibilities calling for new local community structures and a radical break with the past. This did not happen in Italy; not until 1990 (Law 142) were changes regulating local autonomy made to the old 1934 TUEL legislation (Testo Unico sugli Ente Locali). The TUEL itself also clearly derived from the earlier legislation of 1865 (Law 2248), which attempted to establish some basic order among Italian municipalities. This territorially-based model was complemented by the uniform institutional approach that the Italian administration had always taken in its relations with local governments (Merloni 1995). These elements characterise a system that, until the 1990s, applied uniform regulation to extremely diverse areas – from two aspects above all: Almost three-quarters of the municipalities had fewer than 5,000 inhabitants and about half of them were located in mountainous territory, abandoned by time and lacking any development strategy. Italy has some 8,102 municipalities, all of which differ geographically and demographically. About 22 percent of these have a population ranging from 5,000 to 20,000, and comprise 22 percent of the Italian population. The most interesting statistic is that a good 72 percent of the approximately 8,000 municipalities have a population of less than 5,000, representing in total a little less than 20 percent of everyone living in Italy. A notable characteristic of Italy is, therefore, the highly fragmented nature of administration at a local level. The problems that the 1990 legislators had to deal with when drafting law 142 was in reality a consequence of the way national unification had been achieved: through a process of constant bargaining without any "decisive conquering will" or "autonomous drive towards merger” (Romanelli 1995:126). The total of Italian municipalities in 1871 was 8,328, and the situation remained virtually unchanged until 1990 when the number was reduced to the current 8,101. The new regulatory element introduced by Law 142/90 does not so much affect the size of municipalities, but has the potential to influence the uniformity of local government. It breaks the repetitive mould, favouring inter-municipal cooperation and giving more power to urban areas. In fact Law 142 overturned the traditional centralist approach previously taken by the administration in its failed attempts at local authority amalgamation and instead promoted a statutory form of autonomy. However, it also continued to impose fixed limits on it as a result of its essentially authoritarian attitude towards granting autonomy. No detail was left to chance and, consequently, any voluntary grass roots initiative it might have intended to promote was thereby nullified.1 Meticulous top-down logic prevailed in this law and was the source of all problems encountered in its application. There was far too much detail on how municipalities should organise themselves within the different forms of cooperation the law made possible. The most macroscopic case was the creation of metropolitan areas, which effectively gave rise to a new stratum of administration. The legislation permitted

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regional authorities to define new administrative boundaries within which they could reorganise existing municipalities and redefine their responsibilities and functions. This process, however, was designed to take place within a very short timescale and permitted the relevant municipalities only a brief consultative role, even in cases where the reorganisation involved splitting up principal local government offices falling within the new area to reduce the traditional demographic imbalance between large and small municipal administrations. A dispute soon arose between the supporters of vast metropolitan areas (that would largely coincide with their own Provinces) and those who defended a smaller scale reorganisation involving only the main towns and their surrounding villages. Naturally, this argument rapidly came to a decisional stalemate. Only three Regions managed to agree and approve an acceptable size for metropolitan areas, but even this continued to be disputed by the municipalities involved, thereby indicating the existence of another problem. The limitations of Law 142 were not confined to the hierarchical approach it took to its own implementation; Law 142 also underestimated the resistance that the party system continued to exert in the face of local government changes that would have reduced the party’s own power and presence. The ability of a metropolitan area to function effectively presupposes harmony among different levels of government that are not only fragmented but also often politically divided. D’Albergo (2002), for example, provides an analysis of the virtuous circle of collaboration that occurred in Rome between 1994 and 1998 when the majorities on the Regional, Provincial and City councils were, fortunately, all the same political colour. This collaboration immediately ceased when political unity was lost due a change of majority, first in the Province and then in the Region. This confirmed the presence of a more general problem for local autonomy, which affects relationships between the centre and the periphery as well as between parties and administrations. For this reason, attempts at improving the efficiency of administrations – even by permitting diversity – continue to be subject to disequilibrium among different political forces. If, however, we wish to go beyond the sterile opposition between centralism and autonomy, beyond the contrast between local administrative efficiency and the pervasive influence of political forces, we should bear in mind that a new party appeared on the national scene at the start of the 1990s promoting not only ideas of autonomy but also of separatism. The party Lega Nord in fact presented a draft law to transform Italy from a republic into a federation of nine states with twenty one regions in addition to provinces and autonomous municipalities (Diamanti 1996, 2003: Romanelli cit183). For this reason, application of law on autonomy was to take place in a political context that went much further than originally envisaged. This resulted in, on one hand, politicians calling for the introduction of laws by which mayors (Law 81/1993), and the Presidents of the Regions (Law 23 February 1995), would be elected on a majoritarian basis while, on the other hand, they were promoting an institutional debate and making legislative proposals that were strongly “federalist”. After years of immobility, the rules governing local administrations were carried along on the wave of political change and, in the space of only nine years, modified. The new political scenario, while certainly supporting local administration, placed it in an entirely new framework: federalism, which was soon to become a constitutionally

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important issue. The most significant outcome of this countertrend was Law 127/1997, which imposed a requirement on the government to transfer new responsibilities and functions to the regions and local bodies. On this occasion the government acted and by the following year Law 265/1998 had been approved, definitely unblocking the way forward for change. The so-called “unvaried constitution” laws of 1997 and 1998 on administrative federalism ensured a wide transfer of powers from the regions to local government. In the case of metropolitan areas, the 1999 reform aimed more decidedly at, among other things, a greater variety of options, allowing decisions on boundaries and organisation to be made at a lower level by local bodies. Finally, the idea of amalgamating small municipalities, which was still present in the 1990 law, has been abandoned in favour of strengthening cooperation, above all through Unions of municipalities with greater decision-making freedom. The statutory autonomy of municipalities was also extended so that it can now only be limited through the imposition of specific legislative conditions. Thus after decades of inertia, the rules on autonomy were – at the height of political change in favour of autonomy – modified in only nine years and within a new political prospective: that of federalism. The present position of this essentially political and legislative process was eventually achieved in 2001 by a change to Part V of the Italian constitution which, in Article 114, states: “The Republic is composed of municipalities, Provinces, Metropolitan Cities, Regions and the State” Following this Article 118 also affirms that the “administrative functions are the responsibility of the municipalities”, according to principles of “subsidiarity, adequacy and differentiation”. Local autonomy had never before found such explicit recognition of its role and responsibilities. A completely new scenario has thus opened up (Cerulli Irelli & Pinelli 2004), although those problems long resolved in almost all other European countries remain to be analysed. As stated, about 8,000 municipalities in fact remain, of which a good 57 percent have less than 3,000 inhabitants, and it is difficult to imagine that they meet the requirements necessary to fulfil the functions the constitution demands of them. Thus, at the dawn of the 21st century, Italy still finds itself with the problem of small municipalities. Naturally forms of cooperation also existed in the past (and we will discuss them shortly) but, while these were once seen as opportunities, today they are clearly a necessity without which the federalist institutional approach Italy is committed to would be called into question. Centralism has in fact been able to survive without local autonomy. It is difficult to imagine, however, that federalist devolution can now establish itself without promoting new forms of cooperation at a local level. 2. Reasons for Cooperation To better understand the contemporary trend toward cooperation it is important to analyse the role of three fundamental variables: political innovation, the transformation of local contexts caused by regions acquiring greater power, and the emergence of a slow but steady development of new public policies. The first of these variables derived from an internally-driven transformation of the Italian political system; the second was

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externally driven, developing essentially within the European public sphere. The third implies both an internal and external dynamic mainly linked to the transformation of welfare systems. Let’s examine them one by one. At the beginning of the 1990s, the party system that had emerged with the new post-war Italian republic started to come apart. In the course of a few years, all those political forces that had traditionally made up the constitutional rainbow changed their leaderships, names and logos, and at the same time new political parties such as Forza Italia and the Lega Nord arrived on the scene. Without entering into a discussion about the merits of issues that have been widely debated and analysed elsewhere, the essential reasons behind such a change lie in the crisis affecting traditional forms of representation. Historical cleavages, such as those between the centre and periphery and between capital and labour, saw to an ever-growing fragmentation of local interests, encouraging two main consequences. On one hand, relations between parties and their social and economic foundations gradually broke down and, on the other, political instability started to grow in central and local governments. It is really at the administrative level that new political-institutional solutions to this type of problem were tried out. As we have already seen, the introduction of a majoritarian style electoral system for peripheral administrations in the early 1990s established the direct election of mayors and presidents of the provinces, strengthening the political stability of the municipalities. Now the mayor had, among other things, the power to directly appoint and dismiss the officers making up the management committee, which, in turn, needed to establish and maintain a confidential rapport with its first citizen. The novelty that the mayor was no longer elected by the municipality council but directly by citizens seems relevant from two points with respect to inter-communal cooperation2. The first concerns the relationship between the personalization of political leadership and the ability of mayors to engage in problem solving; the second concerns the relationship between the new mayors and the parties at a local level. With respect to the first, we need to consider that – really because of the direct rapport with the electors – the image of a new mayor is strongly influenced by the ability to resolve the specific problems of the local community electorate. Political credibility is therefore significantly linked to the effective management and provision of public services that, in turn, become politically “sensitive” issues for future elections. The second point refers, instead, to a reorganisation of local decisional networks, in which a mayor’s personal qualities (communicative ability, professional competence, authority and so on) are of great importance, as well as the ability to form relationships as an individual and not just within the local political system (Trigilia 2002). Both these elements encourage a type of cooperation with other local bodies. In fact, when faced with scarce financial resources, it is better to cooperate than to abandon the effort to provide local services. The use of Consortia involving different bodies is obviously made easier if relationships are not impeded or even blocked as a result of belonging to differing political parties. Inter-municipal cooperation is, therefore, both a political “resource” and a useful strategy in the search for greater efficiency in administrative activity. Besides this, the search for forms of inter- municipal cooperation also becomes a way of obtaining greater leverage in institutional-political

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negotiations at the regional government level, a level of increasing importance in recent years. The overall outcome of this historical problem has been the creation of what has been called Rescaled Competition State Regimes (Brenner 2004) or, a re-distribution in terms of size and location of the Keynesian nation state’s ability to govern, above all in relation to the relocation of the productive capacity and economic resources to develop the newly defined areas. The most important aspect of such changes lies in the fact that more importance is given to “local economic development goals and competition between areas with respect to the traditional re-distributive and welfare priorities” (Brenner 2005: 28). Small Italian municipalities appear, therefore, subject to a couple of potentially devastating forces: on one hand, the rise of very powerful political-institutional and economic actors (the Regions and large cities) and, on the other, the need to find new innovative forms to promote economic development to meet the challenge of ever more localised forms of competition. These are processes that seem even more important if considered alongside another double trend: the gradual reduction in resources allocated for the protection of traditional welfare rights when, within the same welfare policy, there is an increasing transfer of such responsibilities to local bodies. Against this background, the search for forms of cooperation among municipalities appears to offer a potential path to both the promotion of local development strategies and the protection of welfare services on a local basis. This last point introduces the third variable considered important to an analysis of the underlying reasons for the slow but gradual growth of cooperation among local bodies in Italy. Managing welfare services, and promoting economic development and social cohesion mean coming up with integrated policies that are capable of a combined impact in different areas of social need. Integrated policies, in other terms, tend to act in a co-ordinated and synergic way on various associated problems of public relevance. These are policies primarily of an inter-sector and inter-institutional nature. The former concerns the obvious fact that the success of this type of policy requires simultaneous action in different sectors and, therefore, the mobilisation of resources and interweaving of those policy networks that exist in different, but often adjoining, arenas. Strongly linked to this, the latter aspect explains why the development and implementation of these policies require simultaneous action by institutions that differ in terms of their responsibilities and hierarchical structure, both in the centre and at the periphery. These policies have “purpose-orientated” rather than “condition-based” plans (Fedele 2002) where single action objectives must conform to a commonly agreed vision. As opposed to conditional policies – which operate on the basis of “if .. then” logic – purpose-orientated policies aim at identifying the general end results of an activity and are not determined by norms that set out rules and govern action. In short, they are policies where the cognitive resources of the various actors involved play an important role in conjunction with the institutional framework in which they are developed. These are then policies that give an important role to local authorities, who are forced to seek forms of inter-institutional cooperation to adequately deal with the complexity of the problems they face. Comparison of a small, 1960s municipality with a modern one is sufficient to make the point. The former had no requirement to

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meet the challenge of global competition, no European legislation to take account of; the Regions had still not been set up and, because Italy was in a period of economic expansion, substantial resources were available for services; the social and economic fabric of the country was evenly matched and consequently produced stable demand for goods and services; and a stable, proven and representative political party system was in place. Therefore, no reason existed to justify a search for forms of intermunicipal cooperation. Today, a small Italian municipality must promote itself through marketing projects to hold its own in competition with others; it has obligations arising from the Europeanisation of policies; it must observe the agreements governing its own internal stability which, in turn, are conditioned by the community’s own political stability requirements; it deals with politically powerful regional bodies with wide legislative and planning powers; and it exists in a situation where there is a constant shortage of economic resources. Besides all this, it has an aging population and sees influxes of immigrants which give rise to changing demand in the quantity and quality of services. At the same time, it has growing responsibility in the area of welfare provision within a network in which local administrators are no longer able to count on party influence to make collective decisions and obtain the political consensus necessary to govern. 3. Models of Cooperation When considering these intercomunalità trends all together, the first distinction to make is between cooperation and coordination. We find ourselves increasingly faced with public authority activity that is carried out jointly by two or more public bodies. In the case of cooperation, this occurs through established forms of collaboration; coordination, however, presents aspects that are more informal and more temporary in nature. As Kooiman (2003: 96-114) suggests, cooperation brings about a new legalisedinstitutional structure endowed with its own decision-making powers. Coordination, on the other hand, happens when it is intended to carry out public authority activity in a flexible way, adapting to differing circumstances. These differences bring to mind a common tendency among scholars to classify institutions. In the case of local government, Vandelli (2004: 57; 136) speaks of “associative forms” or “co-ordinated forms”. Neo-institutionalism, instead, more generally (March/Olsen 1987) distinguishes between “integrative institutions” and “aggregative institutions”; in the case of welfare provision, Marshall (1992) talks about of “fusion” and “separation” among the institutions. Another example emerges from Hulst and Van Montfort,3 when they distinguish between “forms of cooperation” that give rise to more or less independent organisations and “forms of coordination” in policy networks that leave responsibility in the hands of local authorities. In all these cases the analysis proposed remains substantially unchanged. The second distinction concerns the issue for which collaboration or cooperation is needed. Intercomunalità can involve (more frequently) the simple provision of services, or (less frequently) the development and implementation of public sector policy. Joint action to provide services implies a division of labour and a subsequent reorganisation of tasks, functions and operating and management responsibilities. It

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imposes, in other words, integrative strategies of an organisational and structural nature, as well as the sharing of technical, professional and economic resources. We are talking of an intercomunalità that is mainly orientated towards achieving economies of scale in the provision of such services that are operationally and economically demanding (refuse disposal, canteens, public transport, security, municipal police and so on). A guideline criterion for public activity is efficient administrative action regarding problems typically found in the management of public services. Interdependence in policy implementation and planning, however, implies more than just the organisation of local administration; it involves the ability to synchronise the entry of a particular issue into the different policy agendas of the municipalities, approach the problem and its solution in a common manner, and bring the different actors involved in contact with each other. It is possible at this point to use the two variables to construct a diagram that will distinguish two principal types of intercomunalità: that directed at collaboration and that involving cooperation. Each form, in turn, has two variants aimed at either the provision of services or policy formulation. Italy’s experience in intercomunalità, which we will subsequently analyse, is illustrated in the following diagram (Figure 1). Figure 1: Forms of intercomunalità

Policy formulation

Zone plane Territorial Pacts

Municipal Unions Mountain Communities Consortia Agreements Conventions

Service provision Collaboration

Cooperation

In the lower left part we can find the forms of intercomunalità that could be defined as collaboration through agreements. These are characterised by the joint action of the different local authorities that deliver services to set up economic forms

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of their management. Agreements and conventions are some examples of this type of intercomunalità. The lower right area includes forms of intercomunalità, which can be defined as of cooperation through rules. The latter are also aimed at delivering services, but differ in that they provide for a high degree of formalisation and institutionalisation of the relations between different municipalities. Consortia, Mountain Communities and Unions of municipalities are examples of this type of cooperation between local authorities. The last two types of association belong to a type of intercomunalità that is not derived from the administrative reforms of the last fifteen years, but from the provision of new public policies. The third type (upper left) involves cases in which cooperation is aimed at policy formulation. Here, weakly structured (from a formal point of view) forms of interactions that feature policy targets as the cohesive factors tend to prevail. They represent forms of intercomunalità that could be defined as of collaboration through pacts, and have a meaningful example in the experience of the Area Pacts. The high level of institutionalisation of interaction among different local authorities is what distinguishes the last type of intercomunalità, especially with respect to the predisposition of the areas of public intervention by law. These experiences (upper right) tend to favour the integration of different policies and the different policy networks that distinguish the policies themselves. We could define these forms of intercomunalità as cooperation through networks, among which the Zone Plans represent a useful example. These differences become more lucid by closely analysing different institutional experiences. Starting with the lower left area, we immediately find one of the more widespread forms of association, that of the Convention. Recent research carried out by Anci–Formez shows that 85 percent of about 7,000 Italian municipalities with fewer than 10,000 inhabitants make use of Conventions. Unlike other forms of association, Conventions do not so much seek to promote shared management among the involved bodies as to coordinate their separate managements, and may also take advantage of a possible financial consortium arrangement. It is a sort of voluntary agreement that ends up either by setting up an office staffed by personnel from the organisations concerned, or by delegating functions to one of the participating bodies. It must be said that when the Convention takes the form of a delegated responsibility, it naturally assumes a high level of trust. Such trust comes out of necessity, given the inability of one or more local bodies to perform the task in question. The fact that the Convention falls into the lower part of the square does not mean that it can only be used for a single activity. On the contrary, providing they are specifically called for, collaboration can also involve a multiplicity of services, so that the Convention is not limited to specific ends. The Programme Agreement is a rather different type of concept that gives rise not to a type of joint management but rather to an organisational tool that promotes collaboration among different bodies. This may also take place through forms of vertical integration of municipalities, provinces and regions. It would be a mistake, however, to consider the Agreement as merely the result of a decision made by municipalities. For some time this has also become “the privileged

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tool for giving content to procedures for the application of policy” (Bobbio 2000: 122). Failure to use an Agreement makes it, in fact, ever more difficult for local bodies to obtain the available financial support. Some studies (Torchia 1997) also point out how, at the end of the 1990s, about 70 or 80 norms already stipulated the use of a Programme Agreement and Bobbio remarks on how this process ended up in a paradoxical situation because “administration through Agreements” soon passed to “centralism through Agreements”. In summary, we always find ourselves faced with forms of intercomunalità, with the exception that they are now often framed in legislative provisions which in fact reduce the “voluntary choice” of municipalities. The second area (bottom left) also contains a distinction between those institutions which show some degree of willingness for local bodies to participate. On one side is the Consortium, representing one of the more traditional forms of cooperation used by municipalities to carry out their functions. The Consortium is usually formed on a voluntary basis, although existing legislation allows the central government to pass a national law obliging the use of Consortia for the management of certain services. On the other side we have the Mountain Community, specifically created by the legislator in the 1970s, but only coming into existence later when the Regions implemented the law. Finally, we have the Unions, which came into existence only at the end of the 1990s. The law that set up the Mountain Communities was based on Article 44 of the Italian constitution, which refers to “provisions in favour of mountainous areas of the country”. Arriving only in 1970, after at least twenty years’ delay, the Mountain Community was set up (as usual) through a particularly inflexible procedure, with the Regions deciding on the boundaries or choosing the municipalities to be included. The Region’s approval was also needed for the Statute chosen by the municipalities, and at a more general level the Region established the type of relationship the Community would have with other bodies. The original intention – that the Community would have responsibility for drawing up its own programme – was soon overtaken by increasing managerial responsibilities that the state, region and municipalities imposed on the Community. We must also remember that in some cases the regional legislator (Lombardy) wanted to create Communities comprising an average of 18 municipalities while, in other places such as the Alps, “Communities considerably larger than thirty communes” (Vandelli 2004: 65) are not at all uncommon. The councils representing such large communities easily exceed 100 members. For these reasons it would be somewhat inaccurate to consider the Communities the outcome of a voluntary decision. In reality we are talking about “necessary bodies” at a second level; some 50 percent of Italy’s Mountain Communities, with more than 10 million inhabitants out of a national population of almost 58 million, fall into this category. However, to arrive at forms of association that are in effect voluntary, we must turn to the Union of municipalities. Originally conceived under the 1990 law, this form of organisation was required to mutate after ten years through an “obligatory transformation”, which would leave the municipalities permanently fused. A greater autonomy was given to the Union of municipalities under the 1999 law and the merger condition was abolished together by one requiring links with its own Province, common boundaries between municipalities, and even the need for municipality members to have at least

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5,000 inhabitants (Formiconi 2003: 17, Bianco 2002). In this way, a multi-purpose associational process – mainly aimed at the provision of services - took shape as the result of what is now, in effect, a voluntary decision by the municipalities. They elect their own representatives to the Union and the use of restricted voting rights also ensures the participation of political minorities. The legislator has provided national incentives (DM 318/2000) to support this highly institutionalised process through the provision of special funds. In cases of merger, 15 percent of the initial costs can be funded; this becomes 23 percent for Mountain Communities and 60 percent in the case of Unions, thus showing preference for the latter. Population size, the number of municipalities involved, and the number of joint ventures undertaken – all are criteria in the evaluation of how the funding is to be shared. The Regions are also able to give further financial support to this process, even if it occurs as a result of large-scale reorganisation of the territory. Today, these Unions are in the majority. The 1999 reform also referred to Mountain Communities as, for example, “Mountain Unions” and this description is further modified in the TUEL of 2000 (Art.27) where they are no longer indicated as “Mountain Unions” but as “Unions of municipalities”, local bodies composed of “Unions of Mountain and part-Mountain municipalities”. Despite the legal tendency to treat them equally, many differences remain between them. The Communities are in fact strongly influenced by regional decisions and thus comprise a far larger average number of municipalities (11) than unions (4). Furthermore, the Unions elect a President chosen from the mayors of the involved municipalities; in the case of a Community, an ordinary municipality councillor can fill the position. Liberated by the 1999 law from the conditions set out in 142/90, the establishment of Unions has found new vigour and interest. Just 19 were created between 1990 and 1999, rising rapidly to 255 in 2005 and involving 1,332 municipalities nationwide with a population of just 3 million. The process has, therefore, assumed significant proportions in the course of few years, even though it remains inadequate in national terms. The largest number of Unions occurs in Lombardy, where 52 have been set up so far, followed by Piemonte with 38 and Veneto with 31. On the other hand, the three Regions of Liguria, Tuscany and Marche have none, and except for Puglia, very few exist in the centre and south of the country. Finally, the number of municipalities involved in each Union varies greatly by region, there being twelve in the Marche unions, seven in those of Piemonte, and only three in those of Lombardy and Friuli (see Table 1). This indicates the different approach that the Regions attach to their promotion, a point to which we will return. To conclude this analysis, we will examine the type of associational activity found in the upper half of the graph, which have different characteristics from those previously examined. In this case we find a mainly obligatory form of intercomunalità that comes less from the administrative reforms affecting local bodies in the last 15 years than from provisions contained in new or second generation public policies (Donolo 2005, Fedele 2002) based on a strong integration in both policy sectors and institutions. One example is certainly given by social policies calling for the creation of Zone plans within a supra-municipal area (upper right). Finally, the upper left area contains the

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Area Pact formats that developed in the second half of the 1990s, in which different institutional actors, businesspeople, civic associations and local interest group representatives collaborate (usually using a Programme Agreement) in local economic development programmes. Figure 2: The regions of Italy

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Table 1: Municipalities and intercomunalità per region REGION Valle d'Aosta Piemonte Lombardy Veneto Trentino A. A. Friuli V. G. Liguria Emilia Romagna Tuscany Marche Umbria Lazio Abruzzo Molise Campania Puglia Basilicata Calabria Sardinia Sicily Total

MUNICIPALITIES 74 1,206 1,546 581 339 219 235 341 287 246 92 378 305 136 551 258 131 409 377 390 8,101

UNIONS 0 38 52 31 2 15 0 10 0 11 1 22 5 8 12 17 0 6 4 21 255

MOUNTAIN COMMUNITIES 8 48 30 19 19 4 19 18 20 3 9 22 19 10 27 6 14 26 25 0 346

What differentiates these two similar models of intercomunalità is the level of institutionalisation of their interaction with the different local bodies involved. Zone plans – which identify policy priorities, operational goals, work programmes, the persons responsible for them and the economic resources needed – cover areas predetermined by the Region and defined as “social-health districts” that include different local bodies. Area Pacts also cover the joint activities of several local administrations, although their operational areas are not legally pre-defined. Naturally we must bear in mind the difference between associations set up to provide services and those created to formulate and implement policies. The boundaries, however, are fuzzy, because the use of institutional forms remains largely unchanged and they are often produced by the same forms used to set up Unions. On the other side, the emphasis on Unions that the municipalities’ representative associations (Anci) tend to justify today on account of their entirely ‘voluntary’ nature must be evaluated in light of the contributions that the Unions attract from the public purse. Such financial support often turns out to be one of the stronger motives for association. This, however, also happens in the case of some policies. The decision to adopt Zone plans for the provision of social and health services is, for example, often dictated by the desire to take advantage of grants from the National Fund for Social Policies, although the latter cannot yet promote the level of intercomunalità that the law deems necessary (Mirabile, Carrera, & Teselli 2004). The different forms of intercomunalità dealt with thus far must be viewed in light of the particular moment in the ongoing process of Italy’s institutional change. The

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administrative system at a national level is, in fact, that of a unitary state going through a process of federalisation (Baldi 2003: 120-30; Caciagli 2003: 20-24; Bifulco, R. 2004: 69-81) and operates on three levels: central, regional and community. However, in federal states, cooperation is used to satisfy the need for autonomy without resorting to centralism; in Italy the process is the precise opposite because cooperation serves, rather, to move from centralism to autonomy (Bifulco, L. 2005). If, as often happens, the Regions have no interest in promoting a form of association that unifies and so strengthens the municipalities it supervises, this lack of political will rebounds on local bodies. It is not possible to cooperate, willingly or otherwise, in an institutional framework that fails to promote not only association, but also what De Martin (2005: 13) in no half measures calls a new “neo-centralism” with respect to local bodies. Presenting the 2004 report on the Italian Provinces, this criticism of the Regions’ approach derives from the assertion that they could “direct municipalities and Provinces from on high”. This then becomes the problem we should examine, focusing on the role played by “regional variants” within the process of building intercomunalità. 4. Regional Variants and Institutional Performance For historical reasons there is a greater distribution of small municipalities in the north of Italy than in the south. For example, of the Piemonte and Lombardy municipalities, about 89 and 74 percent, respectively, are classified as small; Puglia has only 33 percent, similar to Sicily’s approximate 51 percent. Understandably, association has a different impact in the various Regions, but it would be wrong to assume that this dynamic alone could explain the differences in the process of territorial reorganisation. The law on local government (TUEL 2000) emphasises, for example, the Regions’ autonomy in supervising municipalities’ performance of their joint functions as well as identifying levels of good practice. However, research carried out by Anci–Formez (Pecoraro 2003: 33-35) highlighted considerable concern. At least six Regions had not, at the time of the research, put in place any form of regulation in terms of intercomunalità, and seven were still applying legislation that pre-dated the law of 1999. The majority of Regions in the first group were mainly in the south and included not only Puglia and Sicily, but also Basilicata (where small municipalities accounted for 74 percent of the total), Calabria (79.7 percent) and Campania (61.3 percent). There was not even any provision in Molise’s legislation by 2002, despite the Region’s high percentage (92.2) of small municipalities. There is an evident mismatch between national legislation and the way the regions operate, the origins of which lie in the specific social-economic context and existing institutional arrangements. The latter often follow traditional hierarchical models rather than desirable (but currently unattainable) ways of governance. All this does not, however, imply the absence of forms of association and, above all, recent Unions. The process has been governed by a wide interpretation of pre-existing laws, even if they did not necessarily address the problems we are examining. It so happened that in Basilicata, the legislative basis was originally in-

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tended for the development of rural tourism, but it was used because it provided the possibility of forms of association to revise the integrated Zone development plans (Regional Law 14/86). In Sardinia, associations were legalised using a law intended for employment purposes (Regional Law 37/98). The process of forming associational links naturally appears very different when it goes beyond the problem of the simple management of services and seen in the wider context of geographical reorganisation. This happens, for example, in Tuscany where the percentage of small municipalities (49) is much lower than the national average (72). In the past, forms of association prevalent in the Region comprised Conventions, Mountain communities and Associations of municipalities. The last of these was done away with in the 1990s to make room for the application of the new rules introduced at national level. In this way attention shifted from the issue of small municipalities to physically larger areas like Mountain communities, Local Economy Systems, HealthSocial districts and so on, where the provision of services and functions to a number of municipalities has already been tried for some time. Some 49 “optimum level” areas have been planned and, of the 23 that are up and running, a good 16 coincide with the 20 Mountain communities already existing in Tuscany (Bindi 2003: 48-58). Tuscany has sought to encourage neither the merger of municipalities nor the creation of Unions or Consortia for two reasons. First, preference has been given to pre-existing forms of association that can boast a successful track record. Second, it was felt that a high institutional degree, particularly present in Unions, could have reduced the flexibility needed for area reorganisation during the initial phase. Having outlined the way Tuscany regulates forms of association, we can now see how the same problems are dealt with in other Regions. Emilia is interesting from different aspects (Emilia Romagna Region 2003). Like Tuscany, Emilia agrees that municipalities should be able to choose to set up forms of joint management, but the geographical areas in which this occurs are determined after the association has been set up rather than pre-defined. The dominant opinion, in other words, is that there can be considerable discretion in defining an area adapted to meet local needs, meeting as far as possible the wishes of the municipalities. This policy does not mean that one approach is “freer” than the other. Apart from the possibility of municipalities choosing the form of association, in Emilia as in Tuscany, the choice, as a rule, is an obligation for municipalities with a population of less than 10,000. There are, however, other alternatives of importance hidden in what appear to be purely technical solutions, such as those concerning the duration of regional support for joint management arrangements. Both Emilia and Tuscany give five-year grants, but some Regions, like Piemonte and Abruzzo, do not stipulate time limits. In the first situation, the Regions appear to set a time limit within which the joint management arrangement should become self-supporting. In the second situation, the objective seems rather to build stable networks of intercomunalità. The difference shows up different regional trajectories and strategies for supporting and promoting intercomunalità. The criteria used in evaluating grants are another important aspect and deserve consideration. Either the integration of services or the consolidation of organisational structures can be promoted. The first approach has been taken in

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Tuscany, whereas Emilia, which has adopted the second, offers 20 percent higher grants if the bodies concerned set up “single offices” for the function or service carried out in common. Finally, we look at recognised forms of association. Tuscany uses Unions and Consortia less and makes greater use of all the others. Emilia, instead, has avoided promoting Unions (8 percent) because it considers them too rigid and has introduced Associations of municipalities (41 percent). Emilia also has a high level of communal involvement in such associations; only 53 out of 341 municipalities did not join one. In sum, we can see how the processes of intercomunalità take very different paths in these cases. The formats provided for at the national level often prove either inadequate or broader than those chosen by the Regions charged with implementing the policies. There are cases where joint decision making can be carried out within an area already in existence, but also cases where this area is defined in light of what the municipalities want. Whatever the regional approach, the “will” of the municipalities is never free from conditions and even Unions themselves are, from time to time, sidelined because flexibility and a minimum of legal obligations are considered more important in joint management arrangements. It is, therefore, clear how a policy aimed at boundary redefinition continually moves the dividing line between what is free choice by the municipalities and what can be considered a manifestation of regional neo-centralism. Intercomunalità is embedded in geographical contexts that, on one hand, should ensure a horizontal provision of services; on the other it should also implement sectoral policies. What we need to remember is that all this shows the different and heterogeneous ways the process adapts to meet their goals. If we turn now to the functions and services offered, Anci–Formez’s research (2003: 44) highlights certain tendencies. Small municipalities typically use Conventions (30 percent of all Conventions) for the provision of professional type services by a shared municipal secretariat, often consisting of just one person The Consortium is, instead, a more frequently used tool, especially for the management of water supplies (27 percent of the Consortia) and urban sewage disposal (28 percent); because these activities are demanding and sensitive in nature, they often cause disputes among the municipalities involved. Looking now at multiple purpose forms of association, we find that the Mountain Community type organisation is one that is used for refuse disposal (15 percent), for the provision of social services and for SUAP (an office promoting local production). Unions, on the other hand, are more normally used to manage three particular activities: the municipal police (18 percent), technical services (10 percent) and social services (9 percent). The provision of these services through Unions probably improves their quality. This data also appears significant if we remember that, besides Unions, individual municipalities can also simultaneously set up other forms of intercomunalità (Consortia, Conventions and Programme Agreements). Naturally any form of joint management can take on more than one activity. The Mountain Communities together with Unions are used when a wide range of activities is necessary. As regards the use of Conventions, this diminishes drastically as the goals required of them increase. The choice of a Consortia arrangement, instead, is not based on any consideration of the number of activities performed.

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Table 2: Number of services and associative forms

Number of services From 1 to 3 From 4 to 7 Over 7

Conventions 57% 42% 35%

Forms of Intercomunalità Consortia Unions of municipalities 20% 6% 22% 13% 22% 17%

Mountain Communities 13% 18% 17%

Other 4% 5% 9%

Source: Formez 2003

It is clear that, in evaluating the benefits municipalities obtain from joint management, the criteria need go well beyond this consideration. The general trend emerging from opinion polls would seem to indicate that intercomunalità is welcomed both by those responsible for managing it and members of the community. An investigation carried out by Anci–Veneto on a sample of municipalities found a very positive attitude to forms of association as a result of the benefits they bring both in terms of managing services (61.5 percent) and their increased quality (26.9 percent). The "cost" aspect is also particularly felt. A survey (limited to Unions) carried out by Swg (2005), for example, showed that one of their goals is “to provide better services at lower costs” (61 percent), and also “to provide services which the municipalities are individually unable to offer” (55 percent). Instead, it seems that "obtaining grants" (40 percent) tends to be a less important consideration, even though it is evident that phasing out grant aid is something that may not be easily achieved, not only during the initial stages but also in the medium term. The organisational complexity of associational processes, in any case, raises problems that only qualitative surveys can shed light on. Usually the Regions do not have adequate structures to monitor and evaluate the use of monies set aside to promote intercomunalità, or are not yet sufficiently interested. Once funds have been set aside, checks on their use are not so thorough, and returns not so important. For example, in Friuli, the Region is very well aware of what joint management implies, but this has not been sufficient to guarantee continuity and success for the 18 Unions that were formed in 2000. As a result of the inability of the municipalities involved to achieve an effective form of joint management, two of these Unions were dissolved the following year while another two never got off the ground. Aware of this largely unsatisfactory situation, the Region has tended to favour the “extinction” of some Unions, but without applying the economic sanctions stipulated in cases of early closure. As a result, by 2004 only three Unions remained out of the initially planned 18. Once made, grants are not easily recoverable. For one reason, they are calculated in a very approximate manner and do not generally go beyond requiring the bodies involved to present reports on the activities carried out. The Regions require closer monitoring occur above all when there are organisational problems rather than aspects concerning the cost-effectiveness of the service provided. Irpet’s 2003 survey for the Tuscany Region reveals, for example, that the municipalities had difficulty finding qualified personnel able to manage and develop the joint management structures that had been created. Scepticism prevailed, especially in small municipalities, where there

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was often a lack of conviction about the benefits to be had from joint management (Bindi 2003: 85-89). Particularly in cases where there had been no significant previous experience, the early problem is not money but people. The municipalities have to set up an integrated structure and reach agreement on the personnel responsible for the services. There is, then, a need to harmonise existing regulations, agree on common procedures and prepare the necessary paperwork. Until the services come into operation it is difficult to identify their cost-effectiveness and, at least in the early years, they do not produce savings so much as greater expenses. Some Regions insist on evaluating the results of joint management themselves; they also at times think it very important to set up their own cost control mechanism. This approach was taken in Emilia with the municipal police service, resulting in the following (Emilia Romagna Region 2003): Joint management ‘X’, as a unified body, carries out 50 types of activities using a three- shift system, three cars and a staff of eight, issuing 8,000 fines per year. Prior to the creation of their joint structure, the same bodies had identical cost levels, operated a two shift system and performed only 35 functions, producing a lower number of fines. These are interesting considerations, but certainly cannot be taken as typical because the joint management sector is not yet sufficiently developed to permit such a generalisation. In fact there is a problem of the “growth” of experience, which is often in its early stages, especially when compared to existing administrative traditions. Hulst and van Monfort (Introduction) mention, for example, the historical difference between “community based” forms of local government (France, Italy and Spain) with their high level of political representation, and “service delivery type” forms, which occur especially in northern Europe. This point further explains why Italy still has a long way to go both in terms of institutional “performance” and management. Municipalities are used to operating more as representative organisms than as service structures. The reasons in favour of association, like those against, can be economic in the sense that they are linked to the optimisation of services, but in Italy they are, above all, political. 5. Local Governance: Between Efficiency and Political Balance The first law the Italian republic approved on local autonomy was passed in 1990 after years of acrimonious parliamentary debate and more than 40 years after Article 128 of the constitution had explicitly called for parliament to identify its general “principles”. The most convincing explanation advanced to justify such a delay (Rotelli 1981, Dente 1985) points the finger at the tendency of the political parties to “occupy” local and national institutions, because Italy has been essentially a “republic of parties” (Scoppola 1991). Consisting almost in its entirety of apparatchik or state employees (Bettin–Mangier 1995), the local political class has often been considered the main obstacle to the process of redefining local boundaries that began to timidly take shape under the 1990 law and, later, under the 1993 electoral reform Act. The initial success of autonomy over its dry alternative of centralism took place, however, in a new political climate that was most characterised by the appearance of strong tendencies toward federalism and

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autonomy. The decision that soon appeared inevitable was to progressively “free” local administration from the bonds of “uniformity” typical of Italy’s administrative system, and start a restructure that would give the periphery greater autonomy, both with respect to the centre and to the political classes. While local administration slowly freed itself and assumed the administrative responsibilities given it by the reform of Part V of the constitution (2001), public policy took on an ever more integrated and inter-sector nature. By so doing, a new aspect of the problem was revealed: The decision in favour of intercomunalità was founded not just on demographic considerations or on technical ones, but was now intimately connected with the type of problem that the public sector had to deal with. Intercomunalità in fact is essential not only for small municipalities but also for large urban areas engaging in strategic planning that often goes beyond their own regional or national limits (Perulli 2004). It is the presupposition without which it becomes impossible to start creating a metropolitan area (Jouve & Lefèvre 2002). This factor is increasingly present in the health system, which operates principally by district (Moini 2001); it is also fundamental in the development of the local economy (Donolo 2003, Riccone 2002) or environmental policy (Ungaro 2001, 2002), and is the basis used by the legislator in reorganising the new welfare system (Bifulco, L. 2005, Fedele 2005). Regarding these issues, we can use models of the different forms of intercomunalità proposed earlier to show how, apart from policy application, local bodies should tackle substantially complicated social processes. The models are useful also because the boundaries between the four are permeable. With respect to rules, norms and institutions based on a neo-institutional logic, we must bear in mind that local administrations are first required to develop and maintain efficient processes of cooperation (that is, the difficulty of encouraging the development of cooperation in inter-organisational contexts). Secondly, however, they have to deal with problems linked to their ability to avoid predatory coalitions that aim to lay their hands on the economic resources made available for the development of intercomunalità. In other words, we are talking about identifying adequate counter-measures to the inevitable free-riding phenomenon. Faced with this underlying trend, the “new municipalities”, as they are sometimes called (Catanzaro, Piselli, Ramella, & Trigilia 2002), deal with it as they are able. The difficulties are not just institutional or administrative anymore; they are above all political. The way local leadership works now enters the game, as does the timing of the programmes undertaken, the quality of the partnerships set up and, more generally, the ability to find effective answers, which essentially depend on the ability of local authorities to cooperate with each other. Also for these reasons, Trigilia (2005: 147-150) describes the separation between policy and administration as a “decisional illusion” developed in the 1990s because new public policies cannot be routinely put into effect by the administration; they require rather continuous interaction of all the actors involved. And they require, more than anything else, that political leadership not disappear from the scene after the initial stages because that would permit all the centrifugal forces represented by commissioners, administrative departments and interest groups to reappear. On a different scale, these problems reappear in the joint management organisations that we looked at earlier. The general terms we use to describe inter-Municipality activity

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differ more as a result of their intensity than their nature. The argument emphasised by some research as being more important, especially concerning Unions, is that of “strong political will” rather than the chance to take advantage of regional and state aid. Intercomunalità is by now an essential political resource and must be promoted locally to meet different policy goals that may not necessarily coincide because they often hide “collusive coalitions” (Cersosimo & Wolleb 2001), essentially formed to attract public funding with little concern for problems of cooperation. As has happened in France – and despite the fact that we have greatly limited the size of the process – Italy finds itself facing every possible case associated with a transformation of the public domain. This shows up (Pinson 2005) in a growing separation between the political institutions (the municipalities) and the geographically-defined area where the policy is applied. This is a change that comes from afar and seems irreversible today. It is also unthinkable that the federalist road Italy has embarked on could go further without at the same time strengthening the forms of intercomunalità experimented with to date. Constitutional law 3/2001 in fact added an extra paragraph to article 21 of the constitution, saying “In every Region, the council of local autonomous bodies is governed by statute, functioning as the organ of consultation between the Region and the local bodies”. In the Lazio Region together with Calabria, Piemonte, Puglia, Tuscany and Marche, the new statute is already in force, but a law on the number and forms of political and geographical representation will have to be passed. The prospects, however, are not looking good. The regional councils do not in fact see the new organ as an opportunity to enrich the representative function of the assembly, but rather as an antagonist that may reduce the importance of individual councillors because the latter would no longer be the only ones representing the needs of the periphery (Carli 2005). And, bearing in mind that many are very small, a great number of these 8,100 municipalities have no alternative regional level representation. In other words, the issue of intercomunalità is yet not fully resolved; it remains a work in progress whose end is quite obvious. In the next few years, Italy will need to promote more incisive forms of cooperation – that is, if travelling the road to devolution is indeed the goal.

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Bindi S. (2003). La gestione associata di funzioni e servizi nei piccoli comuni (L.R. 40/2001). Retrieved from http://www.irpet.it/index.php?page=pubblicazione&pubblicazione_id=48 – 22k Bobbio, L. (2000). Produzione di politiche a mezzo di contratti nella pubblica amministrazione italiana. Stato e Mercato, 58 Bogason, P. (2000). Public policy and local governance. Cheltenham: Edward Elgar. Brenner, N. (2004). New states spaces: Urban governance and the rescaling of statehood. London: Oxford University Press. Brenner N. (2005). Governance urbana e nuovi spazi deloo stato in Europa occidentale. La Rivista delle Politiche Sociali, 2. Caciagli, M. (2003). Regioni di Europa. Devoluzione, regionalismi, integrazione europea. Bologna: Il Mulino. Cammelli, M. (2000). Autonomie locali e riforme amministrative. Il Mulino, 2. Carli, M. (31 March 2005). Il consiglio delle autonomie locali. Report presented at Il mondo delle seconde camere, Torino. Catanzaro, R., Piselli, F., Ramella, F., & Trigilia, C. (2002). Comuni nuovi. Il cambiamento nei governi locali. Bologna: Il Mulino. Cersossimo, D., & Wolleb, E. (2001). Politiche pubbliche e contesti istituzionali. Una ricerca sui patti territoriali. Stato e Mercato, 63. Cerulli Irelli, V., & Pinelli, C. (Eds.) (2004). Verso il federalismo. Normazione e amministrazione nella riforma del Titolo V della Costituzione. Bologna: Il Mulino. Dente, B. (1985). Governare la frammentazione. Bologna: Il Mulino. De Martin, C. (2005). Rapporto sulle provincia italiane (2004). Retrieved from http://www.upinet.it/contributo.asp?id_contributo=466&id_tema=20&canale=14 Diamanti, I. (1996). Il male del Nord. Lega, localismo, secessione. Roma: Donzelli. Diamanti, I. (2003). Bianco, rosso, verde... e azzurro. Mappe e colori dell'Italia politica. Bologna: Il Mulino. Donolo, C (2003). Il distretto sostenibile. Governare i beni comuni per sviluppo. Milano: Angeli. Donolo, C. (2005). Dalle politiche pubbliche alle pratiche sociali nella produzionedi beni pubblici? Osservazioni su una nuova generazione di policies. Stato e Mercato, 73. Fedele, M. (2002). Il management delle politiche pubbliche. Roma: Laterza. Fedele, M. (2005). Le basi istituzionali del welfare locale. La Rivista delle Politiche Sociali, 2. Formez. (2004). I piccoli comuni e la gestione associata di funzioni e servizi. Roma. Formiconi, D. (2004). L’evoluzione normativa in tema di associazionismo intercomunale. In Formez, I piccoli comuni e la gestione associata di funzioni e servizi. Roma. Fratta, G. (1995). Legislazione italiana in tema di circoscrizioni comunali. In L. Gambi & F. Merloni, Amministrazioni pubbliche e territorio in Italia. Bologna: Il Mulino. Gambi, L., & Merloni, F. (1995). Amministrazioni pubbliche e territorio in Italia. Bologna: Il Mulino. Gambi, L. (1995). L’irrazionale continuità del disegno geografico delle unità politico-amministrative. In L. Gambi & F. Merloni, Amministrazioni pubbliche e territorio in Italia. Bologna: il Mulino. Gaspari, O. (1998). L’Italia dei municipi. Roma: Donzelli. Innes, J., & Booher, D. (2003). Collaborative policy making: Governance through dialogue. In M. Hajer & H. Wagenaar (Eds.), Deliberative Policy Analysis. Cambridge: Cambridge University Press. John, P. (2001). Local governance in Western Europe. London: Sage. Jouve, B., & Lefèvre, C. (2002). Métropoles ingouvernables. Paris: Elsevier. Kooiman, J. (2003). Governing as governance. London: Sage. Maino, F. (2001). La politica sanitaria. Bologna: Il Mulino. March, J.G., & Olsen, J.P. (1987). Rediscovering institutions: The organizational basis of politics. New York: Free Press. Marcou, G. ( 2002). La réforme de l’intercommunalité après la loi Chevènemant: quelles perspectives pour les agglomérations urbaines? Actualité juridique Droit administratif, 3. Marshall, T.H., & Bottomore, T. (1992). Citizenship and social class. London: Pluto Press. Ministère de l’Intérieur, de la Sécurité intérieure et des Libertés locales. (2005). Intercommunalité: une dinamique renforcée dans un cadre juridique rénovè. Paris. Ministère de l’Intérieur, de la Sécurité intérieure et des Libertés locales (1996). Le regroupement des municipalities dans l’Union Européenne. Prérapport sur l’intercommunalité. Paris. Mirabile, M.L., Carrera, F., & Teselli, A. ( 2004). Il monitoraggio dei piani sociali di zona, Rapporto finale. Roma, Ires-Cgil. Moini, G. (2001). Welfare e salute. Verso nuove forme di regolazione pubblica. Roma: Seam.

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Pecoraro, M. (2003). Un’indagine sulla diffusione delle forme di gestione associata di funzioni e servizi. Formez. Perulli, P. (2004). Piani strategici. Milano: Franco Angeli. Pinson, G. (2005). Intercomunalità in Francia: tra innovazione deliberativa e “cul-de-sac” democratico. In F. Gelli (Ed.), La democrazia locale tra rappresentanza e partecipazione. Milano: Franco Angeli. Regione Emilia Romagna. (2003 a). Le gestioni associate tra i comuni in Emilia Romagna. Retrieved from http://www.regione.emilia-romagna.it/gestioni_associate/pdf/rel_riordino_terr_2003 . Regione Emilia Romagna.(2003 b). Indagine sugli effetti indotti dal passaggio alla gestione associata per la funzione di Polizia Municipale e per il servizio Personale. Retrieved from http://www.regione.emiliaromagna.it/gestioni_associate/indagine.htm Riccone, P. (2002). Programmazione negoziata e sviluppo locale: tre patti territoriali a confronto. Rivista Italiana di Politiche Pubbliche, 2. Romanelli, R. (Ed.) (1995). Storia dello stato italiano dall’Unità ad oggi. Roma: Donzelli. Rotelli, E. (1977). La non riforma. Le autonomie locali nell’età dei partiti. Roma: Edizioni Lavoro. Rotelli, E. (2003). L’eclissi federalista. Bologna: Il Mulino. Scoppola, P. (1997). La Repubblica dei partiti. Evoluzione e crisi di un sistema politico (1945-1996), Bologna, Il Mulino Sharpe, L. (1993). The European Meso: an appraisal. In L. Sharpe (Ed.), The rise of meso government in Europe. London: Sage. Swg-Anci. (2005). Le unioni dei comuni da parte di chi le amministra e da parte degli amministrati. Retrieved from www.anci.it/piccolicomuni/notizie.cfm?doc=27. Torchia, L. (1997). La conferenza dei servizi e l’accordo di programma ovvero della difficile transizione. Giornale di Diritto Amministrativo, 7. Toth, F. (2002). La programmazione sanitaria come minaccia all’identità locale. Rivista Italiana di Politiche Pubbliche, 2. Trigilia, C. (2002). Conclusioni. In R. Catanzaro, F. Piselli, F. Ramella, & C. Trigilia, Comuni nuovi: Il cambiamento nei governi locali. Bologna: Il Mulino. Trigilia, C. (2005). Sviluppo locale: Un progetto per l’Italia. Bari: Laterza. Ungaro, D. (2002). Localismo politico. Roma: Seam. Ungano, D. (2004). Democrazia ecologica. L’ambiente e la crisi delle istituzioni liberali. Bari: Laterza. Vandelli, L. (2000). Il governo locale. Bologna: Il Mulino. Vandelli, L. (2004). Il sistema delle autonomie locali. Bologna: Il Mulino. Vandelli, L. (1997). Sindaci e miti.Sisifo tantalo e damocle nell’amministrazione locale. Bologna: Il Mulino.

Notes 1

The forms of association permitted under Part VII of 142/90 were Conventions, Consortiums, Programme Agreements and Unions of municipalities. Part VI provided for the creation of metropolitan areas as a result of boundary changes to the municipalities they would encompass. Metropolitan towns could also have been set up by Regional councils, and should have performed those functions that “present a mainly supramunicipal character, or should be carried out in a coordinated manner for reasons of economy and efficiency” (Article 19). 2 We will later analyse the difference between this concept of collaboration and co-operation and similar ones that take a different approach, mainly using Ian Kooimann’s ideas. For the moment we will take a neutral stance and treat collaboration and co-operation as synonymous. 3 See Introduction, p. 13.

CHAPTER 7 RUDIE HULST & ANDRÉ VAN MONTFORT

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1.

Introduction: The Basic Features of the Administrative System

The administrative system of the Netherlands can be characterized as a decentralised unitary state with three tiers of government: central, provincial and municipal (gemeente). The 1848 Constitution, which remains largely unchanged with respect to the administrative organization of the state, stipulates a general competence for provinces and municipalities to issue bylaws and deliver services they deem necessary in the interest of their communities. Apart from the statutory general competence, it does not contain safeguards for the autonomy of provincial and local government. Contrary to the constitutions of federal systems like Germany or Belgium, the 1848 Constitution does not define specific tasks or competencies for provincial or local government. It does, on the other hand, concede to the national legislator – government and the two chambers of parliament – the right to attribute specific tasks and competencies to provinces and local government, and to call in their cooperation in the execution of national legislation. Therefore, despite the constitutionally established autonomy of provincial and local government, the national legislator has complete sovereignty over the blueprint of the administrative system, the definition of the domain of administrative entities, and the formal relations between the different levels of government. According to the still prevailing “organic theory of the state”, formulated by Rudolph Thorbecke, the nineteenth century liberal statesman and architect of the 1848 Constitution, local government is essential to the Dutch administrative system, the nursery of democratic citizenship and a vital organ for the provision of the public good. Its statutory general competence should enable local government to respond to the diversity of interests as articulated by its inhabitants, R. Hulst and A. van Montfort (eds.), Inter-Municipal Cooperation in Europe, 139–168. © 2007 Springer.

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and to new social and economic developments and issues (Toonen 1987: 61-63, Willemse 2001: 11-12). Historically (from the last decades of the nineteenth century on), local government took the lead in the provision of a wide range of public services. It was the municipalities that founded the first governmentcontrolled abattoirs, that created local health services to further public hygiene, that initiated social housing and income relief, that launched a variety of cultural facilities (Raadschelders 1990, Veldheer 1994). The founding father of Dutch public administration science, Van Poelje, characterized this development as the rise of the welfare “municipality” (Willemse 2001: 35). The era of reconstruction in the aftermath of World War II showed what has become known as a process of “sneaky centralization”. The rise of the mass media created national frames of reference that emphasised national minimum standards for public services and uniform rather than locally differentiated facilities. In a piecemeal way, central government invaded the domain of local government through extensive and detailed regulation (Brasz 1960: 155 et passim). But the scope of local government did the opposite of diminish: With the steady rise of the welfare state, local government became involved in a growing range of public services – albeit within national legal frameworks and subject to national and provincial programs and supervision. Expenditure by local government amounted to more than 30 percent of total public expenditure. In the 1970s and early 1980s, Dutch local government experienced a development similar to those in Sweden and Norway (Page & Goldsmith 1987: 156-157, Bennett 1993: 121). Unlike local government, the province plays a minor part in the administrative system of the Netherlands. In the nineteenth century the role of the province was downplayed out of fear of the resurrection of federalism. Until 1960 the actual responsibilities of the province were limited to water management, the care of provincial infrastructure, and the supervision of local governments’ budgets and financial transactions. With the rise of the welfare state, the provincial domain broadened. Spatial planning became an important task, with substantial impact on town and country planning by local government. Subsequently, the central government called provinces to play a part in the development and execution of plans in a range of policy sectors such as health care, social and cultural policies, waste disposal and environmental policies. Despite the expansion of activities of provincial government, its power vis-à-vis local government remained restricted. In most policy areas provincial plans served as a framework for central government to allocate financial resources to local governments. Provincial government mainly fulfilled the role of an intermediary agency and since the 1980s its position has only become weaker. In the early 1980s, central government embarked upon a series of decentralisation projects to remedy an overburdened central bureaucracy and (perhaps) carry out budget cuts. In several policy areas, decentralisation to local government eliminated provincial competencies for planning, resource allocation, and supervision. Despite the general-purpose character that the constitution entails, provincial governments’ actual domain and competencies are limited.

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2. Dealing With Issues of Scale Over the past 150 years, the different issues of scale – the need for large-scale production of public services and for regional planning and coordination of local government policies – have prompted three strategies.1 The first was the amalgamation of communities to create larger municipalities. Unlike some other European countries, this never came to a nationwide territorial reorganization; amalgamations were of a piecemeal fashion (although some periods show a higher rate than others). In the 1840 Netherlands, 1220 municipalities had boundaries that, for the most part, originated far back in history. After parliament approved the 1851 Local Government Act (Gemeentewet), a corollary of the 1848 Constitution, the first (small) wave of amalgamations took place. The idea was that for local democracy to be viable a municipality should have at least 25 citizens that were entitled to vote (Beeking & Ekamper 1999).2 At the end of the nineteenth century, 1121 municipalities had a population of about 5 million people; over 900 municipalities had fewer than 5000 inhabitants. In the aftermath of World War I, the criteria of rationality and efficiency slowly came to prevail over the historic identity and boundaries of municipalities and caused another (modest) wave of amalgamations. The process of territorial reorganization received new impulses at the end of the 1960s and in the mid 1980s. During this last period, central government established a minimum size for municipalities – first 10,000 then 8,000 inhabitants – without, however, engaging in a reorganization project. Amalgamations took place one by one or in small series per region. One of the reasons for this piecemeal approach was that the act regulating territorial reorganization attributed a central role to the provinces and contained impediments for initiatives by central government.3 Although a 2001 revision of the reorganization act strengthened the position of central government and simplified decision-making procedures, it has not given a more central direction to amalgamation processes. On the contrary, recent cabinets have made it clear that they will not take up territorial reorganization, but will rely on initiatives from municipalities. General criteria for the size of municipalities are no longer established. Amalgamations must be tailored to the circumstances of each case (Beleidskader gemeentelijke herindeling 2002). Despite the piecemeal character of the process of amalgamation, over time it has resulted in a substantial reduction of the number of small communities. Two other facts stand out. First, a considerable number of amalgamations have created municipalities in the range of 5,000 to 20,000 inhabitants, a size that is now generally considered too small for a satisfactory delivery of a series of public services.4 Therefore, despite a substantial increase in scale, a substantial portion of local government fails the requirements for efficient and effective public service delivery on all matters that are part of the local policy domain. Second, projects for amalgamations and boundary changes in the urban agglomerations involving cities and their surrounding municipalities have been less frequent and, if undertaken, have met with considerable and sometimes successful resistance from the peripheral municipalities. As a result, the amalgamation strategy has not

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been able to satisfy the need for an increase in the scale of governance for planning and coordination in the urban agglomerations. Table 1: Population and number of municipalities. 1900 – 2004.5 Year

Total population

1900 1920 1940 1960 1980 1990 2000 2004

5,104,000 6,754,000 8,834,000 11,417,000 14,091,000 14,893,000 15,864,000 16,258,000

Total municipalities 1121 1110 1054 994 811 672 537 483

Average population per municipality 4,553 6,085 8,381 11,486 17,375 22,162 29,542 33,660

Municipalities < 5000 918 845 718 556 246 105 20 12

Municipalities 5000 – 20,000 179 222 280 344 407 384 290 234

Municipalities 20,000 – 50,000 16 32 35 61 114 130 168 173

The second strategy to deal with the issues of scale was to create a new administrative tier of government on a regional level, which in the Dutch context refers to a level between the province and the municipality. Since the 1920s, public administration scholars, research institutes, special advisory committees to the government and the government itself have launched numerous proposals to establish autonomous regional governments that would be large enough to guarantee efficient and high quality public service delivery, and provide for adequate social-economic and spatial planning. Discussions started in 1924 with public administration scholar Van Poelje’s plea for regional administration, and were taken up after World War II with the report of the Koelma committee, which suggested the establishment of “regional districts” for the planning and coordination of local policies. Debates reached a climax in the 1970s, when government proposed to abolish the existing 11 provinces and replace them with 23 smaller “regional provinces”. They would assume some local operational tasks and would establish plans to coordinate the remaining local policies. The last round of the battle for regional government – until now – was fought in the 1990s and concentrated on new administrative systems of government for the urban agglomerations. Government proposed to establish “city provinces” in the areas around the major cities, which would be especially equipped to deal with the interdependencies between the urban centres and the surrounding municipalities. With the exception of two temporary regional districts in Rotterdam and Eindhoven, not one of these proposals was put into effect. The imminent erosion of local government, which would be the inevitable concomitant of the establishment of regional government, time and again proved an obstacle (Hulst 2000: 1-21). For the same reason, transferring tasks and competencies of municipalities to the existing provinces was never under serious consideration as a remedy for the limitations of local government. Although it was sometimes suggested that provinces take responsibility for regional planning, especially when plans for the establishment of

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regional government failed to materialize, they were never equipped with the necessary administrative powers or financial resources.6 Regional public transport aside, provinces are not engaged in the direct delivery of services to the public. In view of the slow and piecemeal process of territorial reorganization of local government, and of the failure to establish regional government equipped to deal with the problems of scale, municipalities have since long resorted to the third strategy: inter-municipal cooperation. The 1851 Local Government Act included a general statutory provision for cooperation between municipalities, but a strict interpretation of the law by the supervising provinces prevented cooperation from flourishing. From the beginning, there was a general concern that cooperation between municipalities might develop into autonomous administrative bodies not accountable to the local councils or subject to democratic control.7 As problems of scale intensified, local government pressed for more leeway to engage in mutual cooperation, and subsequent amendments to the Local Government Act resulted in more room to manoeuvre. When in 1948 proposals to establish regional districts met with strong resistance in parliament and it became clear that inter-municipal cooperation would be the only viable way to deal with problems of scale, the time had come to create a special legal framework. 3. The Legal Framework for Cooperation Inter-municipal cooperation in the Netherlands is subject to the Joint Provisions Act (Wet gemeenschappelijke regelingen), first issued in 1950 and substantially amended in 1985. Since 1995, a special regime applies to (seven) urban agglomerations. The 1950 Joint Provisions Act explicitly granted municipalities the power to cooperate with municipalities, provinces and other public authorities and to establish new administrative authorities, with or without corporate personality, to promote the joint interests of the participating entities. The act allowed municipalities, with few restrictions, to transfer decision-making powers of local government to the joint bodies. In some cases, like the transfer of the authority to issue bylaws, a joint authority with corporate personality was required. Municipalities were free to choose their partners and appoint an executive board – so long as the board did not entirely comprise delegates from only one of the participating municipalities – and establish their own decision-making procedures. This allowed for the possibility to arrange for decision making by way of simple majority voting or on the basis of consensus. One important exception to the ample discretion municipalities enjoyed at setting up their cooperation was that every task, activity or joint interest required a separate arrangement or joint authority to prevent the proliferation of autonomous, multipurpose, regional authorities. Inter-municipal cooperation had to be put into effect along functional lines. On the other hand, there were no limitations with respect to the number of cooperative arrangements municipalities could take part in, and for each they were free to choose different partners. Under the regime of the 1950 Joint Provisions Act, inter-municipal cooperation boomed. In 1971, overall, approximately 1500 different arrangements for cooperation

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had been reported to the supervising authorities. Most of the smaller municipalities were involved in ten or more different regional corporations, which were active with operational tasks. Moreover, and contrary to the intentions of the act, from 1966 on,8 approximately 50 multipurpose regional authorities had been set up, engaged in spatial, economic and environmental planning and in the planning of public housing and infrastructure; ten of the regional authorities had formal powers transferred to them to establish legally binding plans (Instituut voor Bestuurswetenschappen 1975: 76-80). The rapid growth of the number of regional corporations engaged in operational tasks and of multipurpose bodies for regional planning articulated the need for an increase in the scale of local administration. At the same time, the drawbacks of the strategy in use to deal with the issue of scale became increasingly evident. Due to the large number of functional inter-municipal authorities and the fact that these authorities covered different territories, the administrative organization on a regional level had become highly fragmented. Moreover, decision-making in the boards of the inter-municipal authorities lacked transparency and was, in practice, not subject to political control by the elected local councils. Last, as the number of multipurpose planning authorities grew, the spectre of a new, additional administrative level without proper democratic legitimacy loomed.9 Against this background, the government launched several proposals for a radical territorial reorganization that would result in autonomous regional authorities or small provinces. When these proposals (after a public debate of more than ten years) all ended in the wastebasket in 1983, substantial amendments to the 1950 Joint Provisions Act were inevitable. The 1985 Joint Provisions Act, which to this day regulates inter-municipal cooperation, included the following new elements: a.

b.

Each regional corporation set up by the municipalities has a general board that consists of council members of the participating municipalities. The general board formally exercises the competencies and decision-making powers that municipalities transfer to the joint authority, although it can delegate its authority to an executive board. When establishing a regional corporation, the municipalities must regulate the way the members of the general board are accountable to their respective local councils and lay down procedures for the provision of information to the local councils. Moreover, the executive board must present a draft of the budget to the local councils before putting it to the general board. These provisions aimed at strengthening the democratic legitimacy and transparency of decision making by the regional corporations. The provinces must divide their territory into functionally coherent regions. In principle, the act forces the municipalities in their respective regions to integrate all their cooperative arrangements into one, multipurpose joint authority. These provisions aimed to fight fragmentation, as all cooperation would take place between the same municipalities and under the authority of one general board. This part of the legislation was highly controversial, as local governments argued that the optimal scale for cooperation varied according to different policy sectors and activities. In the end, the act provided for exceptions, subject to approval by the provinces.

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In other respects, the regulations concerning inter-municipal cooperation did not change. Municipalities are at liberty to decide what competencies and powers of local government they transfer to the joint authority, if any. Fundamentally, under the rules of the 1985 Joint Provisions Act, cooperation is a voluntary matter. In some cases, however, cooperation has become a matter of statutory obligation. A first category of mandatory cooperation concerns vital public services like fire brigades and ambulance transport that cannot be hampered by scarcity or lack of quality due to problems of scale. In such cases, legislation prescribes municipalities to establish a joint authority under the rules of the 1985 Joint Provisions Act and formulates a minimum program for provisions and activities. A second category of mandatory cooperation follows from the direct attribution of competencies of central government to inter-municipal authorities. Especially between 1985 and 1995, when central government sought to decentralise budget authority for specific grants and it was not possible to transfer this authority directly to the municipalities, it preferred inter-municipal authorities to provinces. Also in these cases, municipalities were expected to proceed according to the rules of the 1985 Joint Provisions Act. In 1995, special legislation came into force for the seven urban agglomerations in the Netherlands. The failure to carry through with a territorial reorganization establishing small-scale provinces throughout the country was considered a serious problem for the metropolitan areas, especially for the cities of Amsterdam, Rotterdam, The Hague and Utrecht. Strong interdependencies between these cities and their neighbouring municipalities called for regional planning and coordination on a wide range of policy sectors and issues. Time and again, voluntary cooperation under the Joint Provisions Act failed to produce effective regional planning. In 1989, a special advisory group – the Montijn committee - called for drastic measures to safeguard the competitive force of the Dutch commercial and industrial centres vis-à-vis their European counterparts. Consequently, central government embarked upon a new project to establish small-scale city provinces. As a first step, it invited local government in the metropolitan areas to set up a new type of regional corporation that constituted a mix between voluntary and mandatory cooperation. The 1995 temporary Framework Law Changing Governance (Kaderwet Bestuur in Verandering) stipulated that the metropolitan regional corporations would be responsible for the planning and coordination with respect to economic development, spatial planning, public housing, infrastructure, and public transport, among other areas. Moreover, the regional corporations would be responsible for the allocation of specific grants funded by central government in a series of policy sectors. In this way, the metropolitan corporations combined the two categories of mandatory cooperation we distinguished earlier. Furthermore, municipalities could transfer other local tasks and competencies to the regional authority on a voluntary basis. In other respects, the metropolitan regional authorities are set up along the lines of the 1985 Joint Provisions Act. A general board, composed of members of the local councils, appoints an executive board entrusted with day-today decision-making. With respect to the relations between the joint authority and the participating municipalities, the rules of the Joint Provisions Act apply. The metropolitan regional corporations were meant to be temporary and would be transformed into city provinces after a five-year period of experimentation

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subject to the consent of the participating municipalities. As it went, proposals to actually establish city provinces met with broad resistance and were eventually dropped altogether. In 2005, the 1995 Framework Law was substituted by the Joint Provisions Act Extra (Wet Gemeenschappelijke Regelingen Plus), which, some details aside, regulates cooperation in the metropolitan areas in the same way as its predecessor, but now on a permanent basis. The legal framework for cooperation sees especially to cooperative arrangements between municipalities, subject to public law when it concerns the provision of public services and the use of public competencies. However, the legislation allows for cooperative arrangements that include other public authorities (provinces, water boards) and private organizations (companies and foundations), thus opening avenues for different forms of mixed regional corporations or cooperative arrangements. Mixed institutions set up under the rules of the Joint Provisions Act are, of course, subject to public law, which includes the rules for democratic decision-making and accountability. Local government can also establish private corporations and organize cooperation between municipalities using private law. We can distinguish between commercial private companies (incorporated or limited) and not-for-profit foundations. For a number of reasons, the private route to institutionalize inter-municipal cooperation is considered inferior from a public administration point of view. Once a company or foundation has been established, it obtains nearly complete autonomy vis-à-vis local government. The executive and supervisory boards, even if they consist of representatives of the municipalities, by law must act in the interest of the company or foundation and are in no way accountable to the local councils. Decision making within the boards takes place behind closed doors and is not subject to supervision by upper levels of government. For these reasons, the Joint Provisions Act stipulates that cooperation between municipalities through private law is only allowed if there are pressing motives to do so. For the same reasons, the private route has been popular amongst municipalities and the supervising authorities have been (very) lenient. Although neighbouring municipalities do in fact with a certain frequency recur to the establishment of private companies and foundations to overcome problems of scale, we will not include these in our analysis of how inter-municipal cooperation works and performs. In our definition of inter-municipal cooperation, we exclude organizations that operate with complete autonomy, even if they are established or owned by the municipalities.10 4.

Inter-municipal Cooperation in Practice

4.1. An overview As mentioned before, the introduction of the 1950 Joint Provisions Act led to a boom in inter-municipal cooperation. The 1985 revision resulted in a reduction of the number of inter-municipal authorities as a consequence of the legal imperative to integrate single-purpose authorities, but the growing public expenditure by intermunicipal authorities over subsequent years shows that cooperation has become

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more and more important. Between 1960 and 1995 it rose from about 0.5 percent to more than 10 percent of total public expenditure by local government. Table 2: Public expenditure through inter-municipal authorities in the Netherlands. 1960 – 2000.11 Year

1960 1965 1970 1975 1980 1985 1990 1995 2000

Expenditure through Total expenditure Expenditure by joint authoriinter-municipal by municipalities* ties as % of total expenditure authorities* by municipalities 15 2,650 0.57% 47 4,887 0.96% 236 7,963 2.96% 800 n.a. n.a. 1,803 26,660 6.76% 2,273 37,010 6.14% 2,855 34,850 8.19% 3,959 38,834 10.19% n.a. 40,722 n.a.

* Millions of euros. Figures include expenditure of specific grants and capital expenditure.

As a corollary to the 1985 Joint Provisions Act, the 12 provinces grouped their municipalities into a total of 62 regions, each ranging from four to 28 municipalities. The subsequent reorganization of inter-municipal cooperation should then ideally have resulted in the establishment of 62 multipurpose joint authorities, where the same group of municipalities would cooperate on a series of operational and planning tasks. For several reasons, this is not the actual organizational picture of inter- municipal cooperation. In the first place, evaluations of the implementation of the 1985 act made it clear that the integration and territorial reorganization was only partially successful (Doeschot et al. 1987, SGBO 1987). From the start, the supervising provinces allowed existing single-purpose authorities to continue functioning and over the years the provinces also approved the establishment of new single-purpose authorities. Over the past decade, departments of central government have encouraged municipalities to set up single-purpose corporations to carry out operational tasks and tasks related to coordination and planning of local policies.12 As a result, in nearly all regions multipurpose corporations have come to coexist with a series of single-purpose authorities. After much discussion, in 2005 the obligation to integrate all the cooperative arrangements between municipalities into one multipurpose authority was formally abolished. In the second place, over the past fifteen years a process of up scaling of inter-municipal cooperation has taken place. In all provinces the number of regions considered functionally coherent for cooperation has decreased, mostly at the initiative of the municipalities themselves. As a result, the number of regions has dropped to 42. In the third place, cooperation has developed in opposite directions with respect to intensity and scope. In some provinces, part of the multipurpose authorities have been

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dismantled and cooperation has been reduced and reorganized, leaving a series of single-purpose corporations engaged in operational tasks. In others, due to pressure from the provinces, municipalities have been forced to intensify their cooperation and broaden the scope. At present there are about 679 cooperative arrangements established on the basis of the Joint Provisions Act.13 To construct a picture of the different types of cooperation and the tasks and policy areas they cover, we have analyzed in detail the existing cooperative arrangements in Zuid-Holland, one of the 12 Dutch provinces. This province includes 86 municipalities involved in 279 cooperative arrangements.14 The details are in Table 3. Table 3: Features of the cooperative arrangements in the province of Zuid-Holland

Policy fields

Nature of the tasks Variety of the tasks Juridical structure and status Partners

Refuse collection and cleansing service Management of schools and colleges Management of archives Fire brigade and ambulance assistance Nature protection and recreation General administration (covering several policy fields) Sheltered workshops Public health Management of roads, waterways, sewer systems or green spaces Another policy field Only or mainly operational tasks Only or mainly coordination tasks Both operational and coordination tasks Single-purpose arrangement Multipurpose arrangement (broad task description) Limited juridical structure: centre municipality construction or simple cooperative arrangement Elaborate juridical structure: regional corporation or communal body Municipalities only Municipalities and other governmental organisations Municipalities, other governmental organisations and inter-municipal organisations Municipalities, other governmental organisations and private organisations Municipalities and private organisations

% of total and number N = 297 6.0 % (17) 5.4 % (15) 4.7 % (13) 4.7 % (13) 4.7 % (13) 4.7 % (13) 3.9 % (11) 2.2 % (6) 1.8 % (5) 62 % 86 % 0.4 % 10 % 95 % 5.0 %

(173) (239) (12) (28) (266) (13)

13.6 %

(38)

86 % (241) 85 % (237) 10 % (28) 0.7 %

(2)

1.0 %

(3)

3.2 %

(9)

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The survey shows that cooperation predominantly concerns operational tasks with a great variety in the policy areas covered. Single-purpose authorities are far more frequent than multipurpose. Moreover, municipalities prefer standing organizations with an elaborate juridical structure and status to simple cooperative agreements. Finally, the mixed forms of cooperation that include private organizations are primarily engaged in the management of educational institutions and in the provision of health insurance for employees of local government. 4.2. Inter-municipal cooperation: The case of social security services provision15 For a number of operational tasks – waste processing, music schools, libraries, swimming pools and so on – inter-municipal cooperation has been in place in the Netherlands for some time. For other operational tasks, such as provision of social security services, inter-municipal cooperation has only recently gained impetus. The rising level of cooperation in this policy field is related to legislation that came into force in 2004. The former Social Security Act (Bijstandswet) was superseded by the Work and Social Security Act (Wet Werk en Bijstand), which makes high demands on municipal authorities. A number of tasks have been decentralised to local government. In addition to granting social security benefits, the municipalities must provide citizens with assistance in securing employment. In other words, in addition to traditional tasks in the field of income provision, municipalities have an extra task in the field of re-activation. Furthermore, decentralisation entails that municipalities draw up documents containing policy outlines for the tasks involved. Finally, municipalities have a greater financial responsibility. The new way that central government finances the municipalities aims at stimulating them to minimise improper use of social security benefits. Municipalities are expected to carry out more stringent checks on persons entitled to social security benefits (Noordam 2005). An increasing number of municipalities have opted for cooperation to comply with these high-level demands. To further cooperation, the Ministry of Social Affairs and Employment offers (limited) financial assistance. Research into social security services provision. How does inter-municipal cooperation in the field of social security services provision actually operate? To answer this question we carried out a research project during the first months of 2005, investigating 15 inter-municipal authorities and lighter forms of cooperation and 36 stand-alone municipal agencies. The different cooperative arrangements included in the research constituted a substantial part of the entire field.16 The 36 stand-alone municipal agencies formed a reasonable representation of all municipal organizations delivering social security services. There was a high variation with respect to the number of residents in the municipalities and considerable geographic distribution. Most of the research data concerned the year 2004; some related to 2003.17 Types of cooperation. In our sample of municipalities that joined forces to provide social security services, eight of the 15 established a regional corporation, i.e., an inter-municipal authority as referred to in the Joint Provisions Act, with or without

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corporate personality. The remaining seven cases represented lighter forms of cooperation. These included, for instance, arrangements whereby one municipality purchases specific services from another. In all cases, the corporations and cooperative arrangements were exclusively involved with the provision of social security services. In other words, they all represented forms of single-purpose cooperation. Another relevant point is that in the majority of the cases under investigation cooperation had only recently been initiated. Only three of the 15 arrangements had existed longer than four years; six had been in operation fewer than three years. Performance. To assess the performance of regional corporations and cooperative arrangements in the field of social security provision, we used several indicators.18 First, the investigation focused on indicators concerning one of the two primary municipal tasks: income provision for persons entitled to benefits. One of the researched subjects was the extent to which municipalities had formulated policies pertaining to granting supplementary benefit.19 All 15 investigated regional corporations and cooperative arrangements had drawn up the required policy documents. This picture did not differ substantially from the stand-alone municipal organizations that were investigated. A vast majority of the 36 municipal agencies also had a policy document pertaining to granting supplementary benefits. Furthermore, the Work and Social Security Act stipulates that, with respect to income provision, municipalities draw up a bylaw to reclaim erroneously issued benefits and other matters.20 Half of the investigated regional corporations and cooperative arrangements complied with this legal requirement. In the vast majority of cases, this concerns regional corporations. Compliance in the lighter forms of co-operation was weaker. This difference between regional corporations and cooperative arrangements was statistically significant.21 No statistically significant differences were established when comparing the different forms of inter-municipal cooperation to the stand-alone municipal organizations. This was regardless of whether the cooperating municipalities were compared with all investigated municipal organizations, only those that were small, or only those that were large. Municipalities annually receive funds for issuing social security benefits (the “income budget”). If municipalities issue fewer benefits than the sum received from the central government, they are entitled to keep the remaining funds. This financial system stimulates municipalities to keep the number of recipients of social benefits as low as possible. One method to achieve this is to carry out regular checks on clients to assess if they are still entitled to the benefit. To what extent do municipalities actively execute these so-called “re-assessments”? Within the investigated group of regional corporations and cooperative arrangements, the average number of re-assessments varied from 0 to 1.4 checks per client. This variation was unrelated to the level of institutionalization. No statistically significant difference was established between the heavy (regional corporations) and the lighter forms of cooperation. Furthermore, no statistically significant differences were established between the regional corporations and cooperative arrangements, and the standalone municipal organizations. Neither did we establish statistically significant differences if the re-assessment activities of the group of cooperating municipalities

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were compared to only the small stand-alone municipal agencies or only the large ones. The absence of performance differences among the group of cooperative arrangements and the group of stand-alone agencies does not mean that there are no differences between individual arrangements and organisations. Some regional corporations, for instance, carry out more frequent checks on clients than some stand-alone agencies of big municipalities. In the second part of our investigation, data were gathered on the second main municipal task in the field of social services delivery: the re-activation of persons entitled to benefit. Social service agencies are required to assist their clients in (re)securing gainful employment. The extent to which they are active in this respect can be measured against the funds that are allocated to re-activation activities per client.22 Substantial variations were established within the investigated group of regional corporations and cooperative arrangements, ranging from 1,000+ to 6,000+ euros per client. This variation did not relate to the form of inter-municipal cooperation. Statistically speaking, with respect to the re-activation related expenditure, no significant difference was established between the highly institutionalized and the less intense forms of cooperation. Furthermore, the research did not establish any statistically significant differences between the regional corporations and cooperative arrangements (as one entity) and the stand-alone municipal organizations (the group as a whole, the small or the large agencies). Another indicator for the extent to which municipalities are active in the field of re-activation is the percentage of clients that are participating in a re-activation program. Yet again, we established substantial variations within the investigated group of regional corporations and cooperative arrangements. The percentage of clients participating in reactivation programs ranged from 13 percent for one social service agency to 59 percent with another agency. Clearly, a number of regional corporations and cooperative arrangements are more active than others. The application of this indicator did not generate any statistically significant differences between the different forms of cooperation and the municipal organizations. This also applied to comparisons made with just the small or just the large municipal organizations. A third aspect of the performance of inter-municipal organizations included in the research was the level of customer service. To gain insight in this element we used four indicators. The first related to hours of operation. Substantial variations were established within the investigated group of regional corporations and cooperative arrangements, ranging from 0 to 35 hours per week. The one extreme was the social service agency that operated an appointments-only system and did not have an open counter. The other extreme was the agency whose counter was open during almost all working hours. The variations established within group of regional corporations and cooperative arrangements were unrelated to the level of institutionalization of cooperation. Furthermore, the research did not establish any statistically significant differences between the regional corporations/cooperative arrangements and the municipal organizations (as a whole, only the small or only the large organizations). The second indicator for the level of customer service was the telephone contactability of the organization. Again, substantial variations were established within the investigated group of regional corporations and cooperative arrangements. The

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contactability ranged from five hours per week for one social service agency to 40 hours for another. Here, no statistically significant difference was established between the regional corporations and the lighter cooperative arrangements. No statistically significant differences were established comparing the different cooperative arrangements to the municipal organizations, regardless of the sizes they were compared to. The third and the fourth indicators were the presence of a website with relevant information and downloadable Internet application forms. Very few variations were established with respect to these indicators within the group of regional corporations and cooperative arrangements. Almost all social services agencies (86 percent) had a website with the address, telephone number, hours of operation and such. Contrary to this, very few agencies (14 percent) provided their clients with the opportunity to download application forms for benefits via the Internet. Statistically speaking, neither of these indicators showed that the performance of regional corporations and cooperative arrangements was better or worse than municipal organizations (the small ones, the large ones or the group as a whole). Costs. Two indicators were used to outline the costs of the social security services provision. The first concerned the system-related costs of the social service agency in proportion to the number of clients. These are the total social service agency’s income less program costs, where the program costs comprise the funds allocated by central government for issuing social security benefits (the “income budget”) and re-activation activities (the “work budget”). The system-related expenditure in proportion to the number of clients varies substantially within the investigated group of regional corporations and cooperative arrangements. This is illustrated in Table 4. No statistically significant differences were established between the regional corporations and the lighter cooperative arrangements with respect to system-related costs. Neither is this the case if the regional corporations and cooperative arrangements are compared with all municipal organizations, with the larger municipal organizations or with the smaller municipal organizations. Table 4: System-related costs per client for the investigated regional corporations and cooperative arrangements 600 - 2,600 Euro 2,600 - 5,200 Euro 5,200 - 6,400 Euro 6,400 – 1,600 Euro Total

(4) (4) (2) (2)

33.3 % 33.3 % 16.7 % 16.7 %

(12) 100.0 %

Missing cases = 3

The second indicator is the size of the workforce (expressed in the number of full-time formation positions) in proportion to the number of clients. Once more, substantial variations were seen within the group of regional corporations and coop-

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erative arrangements. Table 5 shows that one social service agency had two to three times as many employees per client than the other.23 Table 5: Number of full-time formation positions per client for the investigated regional corporations and cooperative arrangements 0.03 – 0.04 formation position per client 0.04 – 0.05 formation position per client 0.05 – 0.06 formation position per client 0.06 – 0.08 formation position per client 0.08 – 0.09 formation position per client Total

(2) (5) (4) (1) (1) (13)

15.4 % 38.5 % 30.8 % 7.7 % 7.7 % 100 %

Missing cases = 2

The variations within the group of regional corporations and cooperative arrangements are unrelated to the level of institutionalization of the cooperation. Furthermore, no statistically significant difference was established between the regional corporations/cooperative arrangements and the municipal organizations. This also applies to comparisons with only the smaller or only the larger stand-alone municipal organizations. Relation between performance and costs. It is evident from the foregoing that there are substantial variations in performance within the group of regional corporations and cooperative arrangements. To what extent are these variations related to the costs, i.e., the financial means municipalities spend on service delivery? The performance of inter-municipal cooperation based on the indicators we selected is only slightly related to the system-related costs per client and number of full-time formation positions per client. Only three statistically significant correlations were established. First, a strongly positive correlation exists between the system-related costs per client and the number of reassessments executed annually per client.24 In other words, the number of reassessments carried out annually by the municipality increased as the sum of money made available per client increased. Furthermore, there appears to be a strong positive correlation between the number of full-time formation positions per client and the contactability of the social service agency.25 Finally, and entirely unexpected, a strong negative correlation was established between the number of formation positions per client and the percentage of clients participating in a reactivation project: The higher the personnel per client, the fewer the clients in reactivation projects.26 We have no satisfactory explanation for this research finding. Conclusions and discussion. It is now time to balance the books and draw conclusions about the performance of different forms of inter-municipal cooperation in relation to stand-alone municipal agencies.27 First, our research showed that there are considerable performance variations within the investigated group of regional corporations and cooperative arrangements (e.g., compliance with the statutory

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obligation to draw up a bylaw, the average number of reassessments executed on an annual basis per client, the percentage of clients in a reactivation project, and the hours of operation). The performance variations within the group of regional corporations and cooperative arrangements were not correlated to the level of institutionalization of the cooperation (except for a single indicator – the drawing up of regulations). This result suggests that cooperation through an integrated organization under a single political and professional management does not necessarily yield better results than looser forms of cooperation. Second, we compared the different forms of cooperation with the stand-alone municipal agencies. No statistically significant differences between the two groups could be established, either in output or efficiency. This applied to comparisons between the regional corporations and cooperative arrangements with all stand-alone municipal organizations; it also applied if the comparison was made with only the large municipal agencies or only the smaller ones. These results are interesting in two respects. One, it shows that cooperation between municipalities resulting in a large scale of production does not systematically produce better results than small-scale production by separate municipalities. Therefore, the up scaling of production through cooperation does not necessarily lead to improved performance. Two, large-scale stand-alone agencies do not perform systematically better than the more laborious production through cooperation. In other words, the amalgamation of local government per se would not yield better results than cooperation. The foregoing suggests that neither the scale nor the form of production is a decisive factor in the level and efficiency of service delivery. Factors like the quality of management or staff, political leadership and contextual factors are candidates to explain differences in performance. Evidently, further research is necessary to establish their possible importance. 4.3. Inter-municipal cooperation: Joint planning and coordination of local policies As mentioned, over the past decades two institutional forms of cooperation have developed with respect to the planning and coordination of local policies. The first has taken the form of more or less loosely coupled networks on different territorial scales. The networks are characterised by a low degree of formalization, the absence of a central authority, and decision-making on the basis of consensus. In the second form, inter-municipal planning and coordination in a number of urban agglomerations has become a matter of relatively strong corporations that enjoy both formal powers and financial resources to enforce their decisions upon the municipalities. We discuss the performance of the two different types of institutions. Coordination and planning through horizontal networks. We distinguish three types of networks involved in the coordination and planning of local policies. The first are networks that included the municipalities of the regions established in keeping with the provisions of the 1985 Joint Provisions Act. In most regions the municipalities set up multipurpose corporations and, as a general rule, entrusted

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them with the coordination of local policies concerning spatial planning and housing. In none of the regions did the municipalities attribute formal decision-making powers of any kind to the joint authorities. Therefore, coordination and planning was and is the result of periodic consultations with the municipalities’ standing committees on spatial planning or housing policies. Sometimes the committees are an integrated part of the existing joint authority and enjoy assistance from its staff; sometimes they function independently. Overall, these networks have been far from successful. Extensive research into the planning and coordination of public housing and spatial policies through regional networks of municipalities showed that it proved very difficult to jointly develop and decide on regional plans. In the exceptional cases where extensive consultations produced a joint plan or policy, its implementation was problematic because of the absence of provisions to force municipalities to honour their commitments (Hulst 2000: 74-78). An in-depth study of horizontal networks involved in coordination and planning revealed that cooperation is contingent on the type of interdependencies between the municipalities. In many cases, municipalities compete with each other for scarce resources, i.e., central government funds allocated through the provinces, the right to develop new housing areas or business parks in densely populated areas, infrastructure and public transport facilities, and the establishment of public health and cultural institutions. When the geographic, demographic and social-economic structure of a region create competitive interdependencies between municipalities it is extremely difficult to engage in long-lasting cooperation. When interdependencies are symbiotic, that is, when municipalities – forced by circumstances – have common goals, a structural basis for cooperation is created. For example, municipalities have teamed up to resist the provinces’ restrictive spatial policies; in some regions the exchange of resources on a structural basis has been the only way for municipalities to attain their long term objectives (Hulst 2000: 83-86). A second factor that determines the performance of the networks is the existing set of social rules regulating interactions between the municipalities. Research shows that, in general, a dominant rule in this type of network is that the autonomy of each participant must be respected and that decision-making should proceed according to the principle of unanimity, providing all municipalities with the right to veto decisions. As a corollary, it is understood that none of the participants can claim any special position or role (Hulst 2000: 86 et passim). In most of the regions included in the research, the municipalities did not appreciate an intermediate role of the executive board or staff of the multipurpose joint authority, as they felt that this might trigger decision-making processes they could not control. All these rules added to the difficulties in the joint planning and coordination of local policies. Reigning social rules were sometimes area-specific. In some regions, the municipalities recognized others’ rights to veto decision making, but with the common understanding that it be exercised with extreme caution. As a consequence, municipalities felt a moral pressure to conform to majority positions. In others, the boards or staffs of the multipurpose corporations were allowed to play a mediating role, drawing up proposals for the standing committees, negotiated beforehand with the individual municipalities.

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These rules usually resulted from positive experiences with occasional joint projects or from a growing consciousness of symbiotic interdependencies between the municipalities, and helped to overcome (perceived) conflicts of interest (Hulst 2000: 89-90). A third factor relevant to the performance of inter-municipal networks is external pressure. Both central government and provinces over time have tried to stimulate inter-municipal cooperation as a means to coordinate and plan local policies. One strategy has been to put regional corporations in charge of subsidy funds to be allocated to the participating municipalities. In this way, central government hoped that cooperating municipalities would develop regional plans as a basis for their allocation decisions and funds would function as a leverage to coordinate local policies. Research into how regional corporations managed subsidy funds for public housing showed that, overall, the municipalities decided not to leave decision making to the executive boards of the joint authorities, but to standing committees where they were all represented. In practice, funds were allocated according to general criteria all could agree upon, like the size of the local community. Only in those regions that already enjoyed a high level of coordination and planning did the allocation of subsidies proceed along the lines of regional housing plans and boards of corporations act as the real decision makers (Hulst 2000: 129-133). A strategy tried by one of the provinces was to delegate decision-making authority on spatial planning to regional corporations in exchange for their commitment to engage in regional coordination, to establish regional plans and policies within a certain time frame and to meet some minimum standards. This strategy proved relatively successful, as most of the regions involved honoured the contracts they had closed with the province, and established spatial plans and rules for the distribution of housing in the region. However, the province undermined the efficacy of its own strategy when it failed to monitor the performance of the corporations and to take measures against obvious perpetrators (Hulst 2000: 149-175). Some of the Dutch provinces take a relatively distant stance towards regional planning and coordination by inter-municipal authorities. In several regions of the province of Noord-Brabant, the municipalities dismantled multipurpose corporations, substituting them with single-purpose authorities engaged in operational tasks like health services and fire brigades, without reaction from the province. Other provinces put more value on regional coordination by the municipalities and have taken to a third, even more drastic strategy: threatening municipalities with largescale amalgamations. In this way, the municipalities involved are forced to strengthen their cooperation, i.e., to transfer local responsibilities and resources to the joint authorities.28 It is too early to tell whether the forced institutionalization of cooperation and the introduction of more vertical elements into the network will actually lead to more effective regional coordination. What seems clear from the research is that the different strategies can bring municipalities to set up the formal institutions for cooperation, and even make them go through the motions of developing plans or establishing rules, but they require supervision and monitoring activities from upper level government to ensure

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genuine regional coordination and planning. Of course, one could ask if there are simpler ways to achieve the same result. A second type of network stems from a concept developed by planning specialists within the framework of national spatial policies: urban networks. The assumption underlying this concept is that the rising social mobility of citizens and their growing individualisation lead to interdependencies between urban centres, big cities and small cities on a territorial scale that supersedes the existing metropolitan regions and call for nearly national scale coordination and planning. The most recent national plans – the Fifth Spatial Memorandum 2001 and the Spatial Memorandum 2004 – designate six urban networks and call for cooperation between the local authorities involved (Van der Burg & Dieleman 2004: 113-115, Priemus 2004: 580). Central government has not issued any guidelines with respect to the institutional design of the urban networks, although it has made clear that it does not intend to establish a new administrative layer. Cooperation is to take place on a voluntary basis, link up with existing networks, be flexible and pragmatic, and respect the autonomy of local government (Spatial Memorandum 2004: 56). Some of the designated networks, like Groningen-Assen in the North and Brabantstad in the South, have already functioned over some years; others have been set up more recently or have had a facelift. The Spatial Memoranda mention the major cities in each of the networks and suggest they cooperate with the provincial authorities, but in some of the networks smaller towns and cities also participate in the joint arrangements and consultations. BrabantStad: A case-study29 The urban network BrabantStad in the South of the Netherlands consists of five cities – Breda, Eindhoven, Helmond,‘s-Hertogenbosch and Tilburg – and the province of Noord-Brabant. The participating authorities set up a steering committee composed of representatives of each city and the province, a series of subcommittees (with aldermen and mayors) and working groups (with officials) for different policy sectors and a small program management bureau to support decision-making by the committees. Every two months all the committees and work groups meet for a day to deal with the issues and proposals prepared by the program management bureau. Since 2001 two programs have been developed to initiate and coordinate activities of the participants in pursuit of the central ambition of the urban network: to further sustainable social-economic and cultural development of the region and to become a prestigious European region. The program for 2004-2008 includes a total of 17 projects, like the realization of a medical school in Eindhoven and Tilburg, the improvement of the accessibility of the Eindhoven region, and the coordinated development of a series of business parks. An analysis of the program development process reveals that the network is truly horizontal. Equality of the planning partners is a main point of departure. The participating cities highly value the independence of the program management bureau and some regret that it holds office in the provincial building, as frequent contacts with provincial officials may contaminate its views. No authority whatsoever is delegated to the program management bureau. The steering committees decide on the basis of consensus and all the important decisions are separately put to the municipal and provincial councils for approval.

158

HULST & VAN MONTFORT To what extent does the network succeed in coordinating the activities and policies of the partners involved? Decision-making about the projects to be included in the program illustrates that actual coordination was very limited. At the start of the development process the partners put forward 50 projects. The steering committee decided that only projects with a clear impact on regional development as a whole could figure in the program. In a second round the number of projects was reduced to 17. However, in practice, the selection was not made according to the criterion of regional impact, but partners made sure that each would participate in the program with a more or less equal number of projects. Moreover, the selection was left to the partner that would carry out the projects and, although the regional impact of the selected projects was sometimes doubtful, the cities did not intervene in each other’s choice of projects, fearing that their own priorities would be questioned. Non-intervention was the rule. In the end, the selection represents the priorities of each of the municipalities, more than the projects with the highest impact on regional social economic and cultural development. Lastly, the fact that projects figure in the development program does not imply anything more than a moral commitment for municipalities to promote their development and implementation.

The strictly horizontal character of urban networks like BrabantStad and decision-making rules that emphasize the equality and autonomy of the participating cities make effective coordination and planning dependent on contingencies and features of the issues at hand. When the interests of the partners coincide, which is the case, say, when it comes to lobbying with central government and the European Union to obtain funding, it is not difficult to reach consensus and join activities. This explains some of the optimism the participants show about the future of an urban network like BrabantStad (Van Stipdonk et al. 2005: 31). However, when coordination and planning imply the uneven distribution of costs and benefits, participants tend to fall back on decision-making rules that underline their autonomy and advocate proportionality. Although provinces admittedly play a substantial role in the institutionalization of urban networks (Hendriks 2004: 39-40, 58-59; Van Stipdonk et al. 2005: 41), so far they have not been able to change the rules of the game in a way that allows for genuine regional policies. The third type of network arises from cooperation between the provinces and municipalities in the course of the development and implementation of provincial plans concerning spatial planning, housing, nature conservation, reconstruction of the agricultural sector and so on. Since the 1970s, when provinces were called in to play the role of a planning bureau on a series of policy sectors, provincial planning has suffered several maladies. In the first place, provinces tended to approach sector planning in the same way as they did spatial planning, i.e., as a unilateral technical exercise built on extensive demographic, social geographic and economic research, resulting in normative frameworks aimed at regulating the decisions and policies of local government. The perspectives of local government on the issues at hand and the viability of the provincial plans received little attention (Mastop 1984: 119 et passim, Hulst 2000: 120). In the second place, provinces were generally in a weak position to enforce their plans. If available, formal administrative authority met with countervailing powers of local government based on local expertise and the fact that the willingness of municipalities to

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set up and carry through with local projects was a necessary condition for the implementation of provincial plans (Hulst 2000: 117-118). In the third place, provincial planning suffered from a lack of coordination between the different policy sectors, a factor that undermined the effective implementation of sector plans. Over the last decade, provinces have tried to remedy these problems by introducing an integrated territorial approach.30 This approach refers both to policy content and to the organization of decision making. The general idea is to establish integrated development plans for all more or less coherent regions, regions that cover the majority of functional interdependencies on a series of policy sectors. The plans must contain both a spatial framework and programs relating to infrastructure projects, business parks, housing, water management, nature conservation and the social-economic development of the region. The objective is to generate as much commitment as possible among the municipalities, the province and other government agencies involved to participate in the development plans and coordinate their activities. With respect to the organizational aspects, provinces strive to create standing committees or authorities that integrate the different territorial and functional authorities, partner with them for strategic planning, and coordinate the implementation of the regional development plans. The institutionalization of the integrated territorial approach is a time consuming process, which, in some regions, especially the ones lacking a tradition of cooperation, meets with substantial resistance. Progress is made where a scarcity of resources or strong interdependencies leave the municipalities in want of adroit regional governance.31 It is too early to tell whether this form of cooperation, which aims to generate contract-like agreements between the parties involved, will be able to counterbalance the centrifugal forces that are so typical in inter-municipal planning. What seems clear is that the role of the provinces is a rather difficult one. On one hand they consider themselves process coordinators, trying to promote inter-municipal coordination; on the other, they are stakeholders too, interested in bringing municipalities to implement their provincial policies. The ambiguity of the provincial role undermines the efficacy of the approach (Toonen 1994). Coordination and planning through metropolitan corporations. As mentioned before, on the invitation of central government in 1995, the municipalities in seven urban areas established metropolitan joint authorities. Initially set up as a first step towards autonomous metropolitan government, they have been given a permanent character with the 2005 Joint Provisions Act Extra (Wet Gemeenschappelijke Regelingen Plus). The foundation of a metropolitan joint authority is a voluntary matter. However, if the municipalities decide to accept the special regime for metropolitan authorities, it implies a series of responsibilities and competencies that all somehow relate to the planning and coordination of local policies. They include the allocation of financial resources put at their disposal by central government (see Table 6). The municipalities themselves have a relatively high opinion of the performance of the metropolitan joint authorities. When central government in 2000 asked them if the special regime should be continued and to found their stance on a self-

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evaluation report, the municipalities in five of the seven regions reported successes and reacted positively.32 Table 6: the statutory responsibilities and competencies of metropolitan corporations Policy sector Spatial planning Public housing

Environment Traffic and transport Economy and employment Land policies

Child and youth care

Adult education

Core responsibilities and competencies Establish a regional spatial plan as a framework for local planning. Establish a regional housing program. Allocation of grants to local housing projects. Establish regulations regarding the distribution of housing. Establish a regional plan and program for the protection of the environment. Establish a regional plan for traffic and transport. Granting concessions and allocating subsidies for public transport. Establish a regional economic development strategy. Issue regulations concerning land grants. Allocation of subsidies for development of new building sites. Management of an equalization fund related to land grants. Establish a regional plan and program concerning facilities for child and youth care. Allocation of subsidies to child and youth care agencies. Establish a regional plan for adult education. Management of subsidy funds.

Both our own research and a critical analysis of the evaluation studies produce a mixed picture at best. Some results have been achieved. Several metropolitan authorities set up mobility funds to finance regional projects for infrastructure and public transport.33 Some of the metropolitan authorities have set up an equalization fund related to land grants as an instrument for the execution of land policies.34 The metropolitan authorities themselves report that progress was made on issues that were urgent in the eyes of all the participating municipalities and consensus was relatively easy to achieve.35 On the other hand, the development of regional policies and plans is a cumbersome, time consuming task with results that leave to be desired. All metropolitan authorities are engaged in the development of regional spatial structure and development plans, but it is difficult to reach consensus and generate commitment from the participating municipalities to carry out the plans. In the metropolitan region of Haaglanden, a regional structural plan was matched by a masterplan of one of the fast growing neighbours of The Hague, Zoetermeer, which formulated its own ambitions and partially contradicted the regional plan.36 In other policy areas too, regional plans failed to function as intended by the legislator. In public housing, for example, some of the metropolitan

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authorities were reluctant to develop and use the regional plan as a basis for the allocation of financial resources. They favoured proportional disbursement and maximum spending autonomy for local government (Hulst 2000: 129-137). The evaluation study on the Amsterdam area reported that most of the regional plans merely summed up the wishes of local government and did not in any way deal with the actual regional issues (Hulst 2001: 16). A typical example of the cautious and consensual approach followed by the metropolitan authorities was how the Amsterdam region dealt with regional housing policies. The metropolitan authority requested the province to be released from the statutory obligation to establish regional rules for the distribution of housing and subsequently tried to reach bilateral agreements with all the municipalities to provide for the coordination of local housing policies. The municipalities negotiated so many escape clauses that only a few regional objectives and criteria applied unconditionally, and in practice they did not even honour these (Meinen 2000: 50-57). The main reason for the suboptimal performance of the metropolitan authorities lies in their institutional ambiguity. On one hand, the authorities are endowed (in principle) with a series of responsibilities, administrative powers and resources that enable them to effectively coordinate local policies. On the other hand, the general boards consist entirely of representatives from the local councils, representatives that find it hard to surrender loyalty to their local constituencies. The executive boards are all too conscious of the fact that they lack the democratic mandate to impose their decisions upon the municipalities and primarily consider themselves policy brokers trying to create consensus. Although the formal rules constitute networks with definite vertical features, social rules prevail that underline the autonomy and the equality of the municipalities and in practice create near to horizontal networks. There is a striking difference between the performance of the metropolitan joint authorities and the Rijnmond Corporation, the regional government that existed in the Rotterdam area from 1967-1985. The latter had fewer formal responsibilities, powers and resources than the former have now, but the fact that the regional council was directly elected created leeway for genuine regional policies. The administrative powers and resources yielded sufficient leverage for effective coordination, even if it was extensive strategic bargaining with the municipalities that actually produced the results (Hulst 2005: 103-104). As mentioned previously, the municipalities of the metropolitan areas are free to organize their cooperation along the lines of the special legal regime. The fact that the regime involves the management of a series of subsidy funds is an incentive to set up metropolitan joint authorities and to assume the tasks and responsibilities related to regional planning and coordination. Apart from this, no forms of supervision relate to the output or quality of inter-municipal cooperation in metropolitan areas. Contrary to some of the horizontal networks discussed above, the provinces generally keep their distance from the metropolitan joint authorities. One reason is that the provinces consider the metropolitan authorities as entities with dominance in a number of policy areas and do not want to interfere in their policy making. The metropolitan authorities are partners of the provinces and central government in

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some specific policy projects and have entered into agreements that force them to develop and carry out plans. Apart from this, there is no outside pressure that helps to overcome the centrifugal forces of inter-municipal cooperation. 4.4. The democratic dimension of cooperation One of the goals of the 1985 amendments of the Joint Provisions Act was to strengthen the democratic legitimacy and transparency of decision making and operations of regional corporations of municipalities. Among other things, for each regional corporation it established a general council with representatives from the local councils and provided for information and advisory rights for the local councils with respect to the budgets of the regional corporations. In principle, these provisions safeguarded that elected local representatives had sufficient information about the ins and outs of cooperative institutions, and could influence and control decision making and practices of the executive boards. In practice, there is little or no involvement of elected local representatives with the governance of regional corporations or lighter forms of cooperation. Research has shown that the local councils hardly make use of their right to advise the regional corporations on their annual budgets or accounts. Nor do members of the local councils use their right to question the colleagues that are delegated to the regional councils about regional affairs and the way they operate with respect to the executives of the regional corporations (Everink & van Montfort 1994). Involvement of the elected representatives appears to be almost absent, especially when it comes to cooperation in operational tasks (Herweijer 1998: 152). The low political profile of some of these tasks (fire brigade, waste management) may explain the marginal involvement of elected representatives. On the other hand, the operational tasks frequently take up substantial parts of the budget of local government. Scarce involvement of the local councils and their individual members with the decision making and management of regional affairs is not unique; the same goes for the regional councils. Decision making on both operational tasks and coordination tasks predominantly takes place in standing committees where the executives of all the municipalities involved are represented and, to a lesser extent, in the executive boards of the regional corporations. The role of the regional councils, composed of the delegates from the elected local councils, is modest at best (SGBO 1991, Hulst 2000: 78-83). Research has shown that the role of the regional councils is a more active one in that regional corporations have more formal competencies to establish plans and policies with actual repercussions for the participating municipalities, which is the case of the metropolitan regional corporations (Hulst 2000: 138-141). All in all, the conclusion must be that decision making and management with respect to matters of inter-municipal cooperation are predominantly matters of the executives of the local governments involved. The role of elected representatives is (very) small, and therefore the interests of the local citizen are ill-represented.

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5. Conclusions The Dutch administrative system can be characterised as a decentralised unitary state, with three tiers of general government: central, provincial and municipal. With the steady rise of the welfare state after World War II, local government became involved in a growing range of public services, albeit within national legal frameworks and subject to national and provincial programs and supervision. Today, expenditure by local government amounts to more than 30 percent of total public expenditure. Over time there has been a slow and piecemeal process of amalgamation of municipalities. Although the number of municipalities has thus been substantially reduced, the territorial reorganization has not kept pace with the growing scales of production and planning. Subsequent attempts to establish a regional tier of general government have failed. Because of this, municipalities have long since resorted to inter-municipal cooperation as the only viable strategy to fill the need for large-scale service delivery and the planning and coordination of local government policies. The legal framework, the Joint Provisions Act, grants municipalities the power to cooperate with municipalities, provinces and other public authorities and to establish joint authorities, with or without corporate personality. Municipalities are largely at liberty to decide what competencies and powers of local government they transfer to a joint authority. After the introduction of the Joint Provisions Act in 1950, the number of joint authorities grew rapidly. Although the number has decreased slightly since 1990 due to the up scaling of cooperation, the growing amount of public expenditure by inter-municipal authorities shows that cooperation has become increasingly important. Between 1960 and 1995, it rose from about 0.5 percent to more than 10 percent of total public expenditure by local government. In practice, cooperation predominantly concerns operational tasks; there is a great variety in the policy areas covered. Single-purpose authorities are much more frequent than multipurpose authorities. Moreover, municipalities prefer standing organisations with an elaborate juridical structure and status to simple cooperative agreements. There is little or no systematic research on the performance of different forms of cooperation, especially with respect to operational tasks. Our research into operational tasks in the field of social security services provision showed that the performance of the different forms of cooperation in use varied substantially, both in terms of output and efficiency. These variations, for the most part, are not related to the degree of institutionalisation of inter-municipal cooperation. No performance differences and cost-related differences were established between inter-municipal authorities and cooperative arrangements as a group and stand-alone municipal organisations. These findings suggest that common assumptions about the performance of inter-municipal cooperation deserve critical examination. First, the larger scale of production that is realised through inter-municipal cooperation does not necessarily yield better results, as we found no performance differences between forms of cooperation and small stand-alone organisations. This suggests that the scale of production is not a decisive factor. Second, stand-alone organizations in large municipalities did not perform systematically better than forms of cooperation.

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This suggests that the relatively complex organization of service delivery through cooperation is not inferior to stand-alone municipal agencies with a unity of political command. Apparently, other factors than the scale and form of production are relevant to performance. Further research is necessary. While the evidence on the performance of joint authorities involved in operational tasks is scarce, there has been considerable research into cooperation with respect to the joint planning and coordination of local policies. Over the past decades in the Netherlands, two institutional forms of cooperation have developed with respect to this kind of activity. First, cooperation has taken the form of more or less loosely coupled networks on different territorial scales. The networks are characterised by a low degree of formalisation, the absence of a central authority, and decision making on the basis of consensus. These networks are not very successful, whatever their specific forms. In depth study of horizontal networks involved in coordination and planning revealed that cooperation is contingent on the types of municipal interdependencies. In many cases, municipalities compete with each other for scarce resources. When the geographic, demographic and social-economic structure of a region create competitive interdependencies between the municipalities, engaging in lasting cooperation proves extremely difficult. A second factor that determines the performance of the networks is the existing set of social rules regulating the interactions between the municipalities. A dominant rule in the networks of municipalities is that the autonomy of each participant must be respected and that decision making should proceed according to the principle of unanimity, providing all the municipalities with the right to veto decisions they do not find in their own interest. A third relevant factor is outside pressure. Research to date reveals that supervision and monitoring of activities by upper level government are required to ensure genuine regional coordination and planning. Second, cooperation with respect to the planning and coordination of local policies has taken the form of relatively strong joint authorities that enjoy both formal powers and financial resources to enforce their decisions upon the municipalities. On the invitation of central government, municipalities in seven urban areas established metropolitan joint authorities with a series of responsibilities and competencies that all relate to the planning and coordination of local policies. The metropolitan joint authorities do not function very well. The main reason for the suboptimal performance lies in the institutional ambiguity of the metropolitan authorities. On one hand, the authorities are endowed (in principle) with a series of responsibilities, administrative powers and resources that enable them to effectively coordinate local policies. On the other hand, the general boards entirely consist of representatives from the local councils, representatives that find it hard to give up their loyalty to their local constituencies. There is no outside pressure that helps overcome the centrifugal forces metropolitan authorities have to deal with. The findings with respect to both types of cooperation regarding the planning and coordination of local policies show that the institutional form to a great extent explains the overall poor performance of the authorities involved. Apparently, the tasks involved require a form of integrated political management, which the networks and joint authorities lack.

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With regard to the democratic dimension of cooperation, we have concluded that various elements of the Joint Provisions Act aim to keep elected local representatives informed about the ins and outs of cooperative institutions. The legal provisions also intend to safeguard elected local representatives’ influence and control over decision making and practices of the executive boards. However, in practice there is little or no involvement of elected local representatives with the governance of regional corporations or lighter forms of cooperation. Inter-municipal cooperation is predominantly a matter of the executives of the local governments involved. The role of elected representatives is (very) small. Therefore the interests of the local citizen are ill-represented. The only strategy? The administrative system of the Netherlands is characterised by a thick measure of viscosity. Overall reorganizations are rare due to the fact that consensual decision making is a main feature of the national political culture. Vested interests usually have ample opportunity to obstruct radical changes; the graveyard of the national political arena is full of reorganization projects that have failed. This is why inter-municipal cooperation has in practice been the main strategy to address the pressures local government has confronted over the past decades. Should it remain that way? Inter-municipal cooperation has the advantage of flexibility. Scope and scale adjust, with relative ease, to new circumstances. The data gathered in this chapter, however, show that it is not without problems. In the first place, cooperation is not an effective means to coordinate local policies, whether it takes place in loosely coupled networks or through integrated joint authorities. In the second place, there is the democratic deficit. Directly elected councillors play no role in the governance of joint authorities, despite formal provisions to that effect. Experience with the Rijnmond Corporation in the Rotterdam area shows that the direct election of governing councils can serve as a remedy for both maladies. It creates the necessary conditions for political leadership in the effective coordination of local policies and provides democratic legitimacy for the policies and operations of joint authorities. Then again, the introduction of direct elections would not be without problems either, because of the number and fragmentation of cooperative arrangements. It would presuppose a rationalization of the system of cooperation. Against this background two alternative strategies to deal with the pressures on local government merit more attention than they have enjoyed in the last decades: (1) the amalgamation of local government under the democratic control of local councils as a means to create sufficient scale for service delivery and (2) equipping intermediate level government (the provinces) with sufficient power to effectively coordinate local policies. Given the national political culture, however, the most likely scenario is that the Netherlands will muddle through for some time within a partially functional strategy of inter-municipal cooperation. References Beekink, E., & Ekamper, P. (1999). De grenzen verlegd. Twee eeuwen herindeling Nederlandse gemeenten. Demos, 15(6).

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Bennett, R.J. (Ed.). (1993). Local government in the new Europe. London: Belhaven Press. Brasz, H.A. (1960). Veranderingen in het Nederlandse communalisme. De gemeentebesturen als element in het Nederlandse stelsel van sociale beheersing. Assen: Van Gorcum. Burg, A.J. van der, & Dieleman, F.M. (2004). Dutch urbanisation policies: From ‘compact city’ to ‘urban network’. Tijdschrift voor Economische en Sociale Geografie, 95(1), 108-116. Doeschot, R.G.P., Boskma, A.F., Herweijer, M., & Oosting, M. (1987). Intergemeentelijke samenwerking. Deventer: Kluwer. Everink, M.E., & van Montfort, A.J.G.M. (1994). Waar een wil is, is een weg: Regionale bestuurskracht en bestuurlijke vernieuwing in de niet-stedelijke gebieden. Bestuurswetenschappen, 48(5), 421-434. Faber, K.A., & van Montfort, A.J.G.M. (2006). Want zij zijn groot en ik is klein. Intergemeentelijke samenwerking bij uitvoering Wet werk en bijstand. In M. Herweijer, W.A. Zondag, & G.J. Vonk (Eds.), De Kronieken Sociale Zekerheid: 1986-2006 (Liber Amicorum presented to prof.mr. F.M. Noordam). Deventer: Kluwer (in press). Hendriks, G.J. (2004). Mythe of werkelijkheid? Onderzoek naar sociale regels in stedelijke netwerken. MA thesis, Vrije Universiteit Amsterdam. Herweijer, M. (1998). Schaal en gemeente. In A.F.A. Korsten, & P.W. Tops (Eds.), Lokaal bestuur in Nederland. Inleiding in de gemeentekunde (135-156). Alphen aan den Rijn: Samsom. Hulst, J.R. (2000). De bestuurlijke vormgeving van regionale beleidsvoering. Delft: Eburon. Hulst, J.R. (2001). De provincie en regionaal bestuur in grootstedelijke gebieden. Openbaar bestuur, 11(2), 15–19. Hulst, J.R. (2005). Regional governance in unitary states: Lessons from the Netherlands in comparative perspective. Local Government Studies, 31(1), 99-120. Instituut voor Bestuurswetenschappen. (1975). Onderzoek naar de bestuurlijke organisatie. Deel 2. Eindrapport. The Hague: Staatsuitgeverij. Meinen, C. (2000). ROA! Een aflopende zaak? MA thesis, Vrije Universiteit Amsterdam. Noordam, F.M. (2005). Wet werk en bijstand in hoofdlijnen. The Hague: Sdu Uitgevers. Page, E.C., & Goldsmith, M.J. (Eds.). (1987). Central and local government relations: A comparative analysis of west European unitary states. London: Sage. Partners & Pröpper. (2005). Trendstudie – Samenwerking decentrale overheden. Vught: Partners & Pröpper, bestuurskundig onderzoek en advies. Priemus, H. (2004). Spatial memorandum 2004: A turning point in the Netherlands’ spatial development policy. Tijdschrift voor Economische en Sociale Geografie, 95(5), 578-583. Raadschelders, J.C.N. (1990). Plaatselijke bestuurlijke ontwikkelingen 1600-1980. Een historischbestuurskundig onderzoek in vier Noord-Hollandse gemeenten. Ph.D. thesis, Leiden University. The Hague: VNG. SGBO. (1991). De WGR gewaardeerd. Eindrapport. The Hague: VNG. SGBO. (1997). Samenwerking tussen decentrale overheden. Aantallen, motieven en trends. The Hague: VNG. Stipdonk, V. van, Hendriks, F., & Tops, P. (2005). Getting it together: A study of intergovernmental cooperation in the Netherlands. In F. Hendriks, V. van Stipdonk, & P. Tops (Eds.), Urban-regional governance in the European Union. Practices and prospects. The Hague: Elsevier Overheid. Toonen, Th.A.J. (1987). Denken over Binnenlands Bestuur, Theorieën van de gedecentraliseerde eenheidsstaat bestuurskundig beschouwd. The Hague: Vuga. Toonen, Th.A.J. (1994). Vernieuwing van politiek en bestuur in de provincie. IPO-strategiegroep Van Kemenade. Bureau voor Contract Research. Rotterdam. Van Montfort, A., & Coolsma, J. (1995). Intergemeentelijke samenwerking als uitdaging. In S.Denters, et al. (Eds.), Decentrale democratie (153-169). Enschede: University of Twente. Van Montfort, A., & Hulst, R. (2005). Gaat het samen beter? Intergemeentelijke samenwerking bij uitvoering Wet Werk en Bijstand. Available at http://www.samenwerkeninuitvoering.nl/Download_Centrum. Veldheer, V. (1994). Kantelend bestuur. Onderzoek naar de ontwikkeling van taken van het lokale bestuur in de periode 1851-1985 (Ph.D. thesis, Leiden University). Rijswijk: SCP. Waltmans, H.J.G. (1994). Gemeentelijke herindeling in Nederland: Van de Franse tijd tot heden. Hoogezand: Stubeg. Willemse, R. (2001). Het bestaansrecht van de Nederlandse gemeente. Delft: Eburon.

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Notes 1

Cf. chapter I, section 1. Until 1919, the right to vote was restricted to men and related to income and “suitability”. 3 The act in question, Wet algemene regels herindeling, contained rules for territorial reorganization. 4 Reflecting on the policies for territorial reorganization of the 1980s and 1990s, central government concluded in 1998 that 8,000 inhabitants, established as a minimum size for amalgamated municipalities in practice, was taken as a fixed target, and resulted in a modest strengthening of the local government involved (Beleidsnotitie gemeentelijke herindeling 1998). 5 Data from the Dutch Central Bureau of Statistics, CBS, StatLine. 6 Spatial and environmental planning are notable exceptions. 7 The executive board of the province of Zuid-Holland did not allow two municipalities to jointly employ one local police officer, as it would not be clear on whose authority he would act. 8 In 1966, the second national plan for spatial development explicitly called for an increase in the scale of local administration. From then on, the supervising authorities allowed municipalities to set up the multipurpose authorities theretofore denied them. 9 These years gave birth to the slogan, “Beware of a fourth administrative tier”, which has been repeated time and again by the authorities responsible for the administrative organization. Scholars of public administration have neatly pointed out that the Dutch administrative system really includes six or seven administrative levels: the European Union, the central state, inter-provincial authorities, the provinces, inter-municipal authorities, local government and, in the bigger cities, neighbourhood councils. 10 Cf. chapter I, section 5. 11 Data from the Dutch Central Bureau of Statistics, CBS, StatLine. 12 Central government has been far from consistent in its policies concerning inter-municipal cooperation. On several occasions, it has declared that joint authorities should not be endowed with responsibilities and competencies because they lack democratic legitimacy and must not develop into autonomous regional governments. Notwithstanding, individual departments over time have transferred the responsibility for the management of subsidy funds to joint authorities (for the development of building sites, social housing) and have encouraged or even forced municipalities to set up joint authorities (environmental inspection services, fire brigades, emergency services, services for income relief and employment). 13 This number does not include private foundations and companies established by municipalities. They number a total of 1165 (Partners & Pröpper 2005: 11). 14 Data from the provincial register of inter-municipal authorities in Zuid-Holland, 2006. An overall but somewhat dated picture of the different forms of inter-municipal cooperation in the Netherlands can be found in SGBO (1997). See also Partners & Pröpper (2005: 15). 15 This section is a somewhat modified version of a Dutch-language research paper (Van Montfort & Hulst 2005). The research findings have also been published in Faber & Van Montfort (2006). 16 The majority of all regional corporations have been investigated. A substantial number of the lighter cooperative arrangements (e.g., purchase relationships with neighbouring municipalities) have been incorporated in the research. 17 Part of the information about the regional corporations, cooperative arrangements and municipal organizations was gathered through the analysis of annual reports, budgets etc. The remaining data was obtained through a standardised questionnaire issued to civil servants. 18 We use the term “performance” in a broad sense. It relates not only to outcomes (the social impact of government policies) but also to processes and outputs (activities and products of government agencies). The research project in question was limited to process and output indicators. 19 People without means of subsistence are entitled to a standard benefit. A supplementary benefit provides for special circumstances and expenses they cannot pay out of their standard benefit. 20 Article 8a of the Work and Social Security Act. The act makes no further stipulations regarding the contents of the bylaw. 21 Pearson Correlation = 0.714, p = 0.004. A reliability interval of 5 percent was used for the application of statistical tests. Correlations between two variables are thus statistically significant if p < 0.05. 22 For this performance indicator, abstractions are made from the price negotiated by regional corporations, cooperative arrangements and municipal organizations with the private reintegration companies, and from the manner in which regional corporations, cooperative arrangements and municipal organizations distribute the funds allocated for reactivation among the persons entitled to benefit. 23 The data presented in table 6 pertaining to the number of formation positions available in a regional corporation or cooperative arrangement for the provision of social security services may not be fully 2

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reliable. Some of the officials who participated in the survey also included (a part of) the staff that is also involved with other social services tasks, for example, issuing provisions as defined in the Handicapped Provisions Act. The variation within the group of regional corporations and cooperative arrangements may, in reality, be smaller than the table suggests. 24 Pearson Correlation = 0.606, p = 0.036. 25 Pearson Correlation = 0.859, p = 0.000. 26 Pearson Correlation = - 0.659, p = 0.038. 27 The findings presented in this section should be handled with care. They relate to a limited number of government agencies. This applies especially to the investigated regional corporations and cooperative arrangements. 28 Memorandum of the Executive Board of the province of Zuid-Holland about the relations between the province and the regional joint authorities, 19 April 2005. 29 Based on Hendriks (2004: 39-57) and Van Stipdonk et al. (2005: 28-31). 30 In Dutch: gebiedsgerichte benadering. 31 Memorandum of the Executive Board of the province of Zuid-Holland about the relations between the province and the regional joint authorities, 19th of April 2005. 32 In one of the two other cases a failed amalgamation project had poisoned the relations between the municipalities. 33 The funds are financed by the department of Traffic and by the municipalities. 34 The funds are used to make up for deficits in the development of building sites that have a strategic role in the national and regional spatial policy. The funds are financed by the department of Housing and by the municipalities. 35 Memorandum from the Minister of the Interior to the House of Commons, 12th of March 2001 (Tweede Kamer 2000-2001, 27 633, nr. 1), p. 7. 36 Social Economic Council, Advice on the 5th Spatial Memorandum, 21st of September 2001, p. 80.

CHAPTER 8 EVA NIETO GARRIDO

INTER-MUNICIPAL COOPERATION IN SPAIN: DEALING WITH MICROSCOPIC LOCAL GOVERNMENT

1.

Introduction

This chapter analyses inter-municipal cooperation in Spain, explaining its origins and evolution, and particularly how the Spanish Constitution of 1978 contributed to its development by recognising the principle of local autonomy. The chapter is laid out in five parts. Section 2, which follows this introduction, deals with the historic evolution of inter-municipal cooperation in Spain. The third part describes current data on intermunicipal cooperation in Spain, concentrating on its three main entities: mancomunidades (municipal associations), Metropolitan Areas and Administrative Consortia. Parts 4, 5 and 6 analyse, respectively, the regulation and legal regime of the three aforementioned entities, highlighting the functional problems detected thus far. When talking about mancomunidades, Metropolitan Areas and Consortia, we face different types of inter-municipal cooperation. The mancomunidades represent inter-municipal cooperation in its pure form: They are established by mutual agreement of the municipalities and no other authorities or private parties are involved. The Administrative Consortia also have a voluntary character, but comprise entities of a different nature: They can involve local authorities, authorities of the Autonomous Communities and the State, and (not for profit) private institutions. Metropolitan Areas are established through laws issued by the Autonomous Communities. Although municipalities formally do not establish the metropolitan authorities themselves, they are involved in their constitution and function as their governors; the councils of the Metropolitan Areas consist of representatives of the municipalities. The Metropolitan Areas may therefore be characterized as a form of mandatory cooperation. Although neither the Administrative Consortia nor the Metropolitan Areas represent inter-municipal cooperation in its pure form, they are the entities that, after the mancomunidades, have best channelled the establishment of common technical and economic resources on the part of public entities to respond to necessary R. Hulst and A. van Montfort (eds.), Inter-Municipal Cooperation in Europe, 169–192. © 2007 Springer.

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requirements generally of a local nature. Hence their inclusion in this chapter dedicated to inter-municipal cooperation in Spain. 1.1. The institutional context The transition from the authoritarian Franco regime to the actual democratic political system brought about a radical change in the organization of the Spanish public administrative system. The 1978 Constitution paved the way for – or some would say channelled the inevitable development of – a quasi federal system of administration, a system that is far from reaching a more or less stable state. The then newly constituted seventeen Autonomous Communities have increasingly acquired competencies over the past decade, and negotiations – about the transfer of central government tasks and responsibilities, about the financial relations between the central state and the Autonomous Communities and about new statutes for the different Autonomous Communities – have yet to come to an end. All in all, over a period of nearly 30 years, the Autonomous Communities have developed into new centres of administrative power at the intermediate level with exclusive competencies in policy sectors like spatial planning, public housing and public works, culture, health care, sports and environment, and with substantial responsibilities in the fields of agriculture, education and economic development. While the transition marked the birth of the Autonomous Communities it has come to threaten the position of another level of intermediate government: the provinces. During the Franco era the provinces formed an important part of the state administration, comparable to the French departements prior to the decentralization projects of the 1980s. Both the regional offices of the central ministries and the military and police apparatus were organized according to the 50 provincial territories. Although the 1978 Constitution confirmed the existence of provinces as autonomous authorities,1 the first proposal for the basic law on the local government regime (Ley de Bases reguladora del Régimen Local, LBRL) did not stipulate any exclusive competencies for the provinces, thereby leaving it to the Autonomous Communities and ordinary national law to determine their role. This was much to the liking of the socialist party (PSOE), which valued the development of a pluriform administrative system. In the end, however, after the Constitutional Court had asserted the competence of the national legislator to establish a basic law containing the fundamentals for the local government regime, a series of minimum tasks and competencies for the provinces were included in the LBRL (Carballeira Rivera, 1991): the coordination of public service delivery by the municipalities, the delivery of public services of a clearly supra-municipal character, supporting and cooperating with municipalities on legal, economic and technical issues, and taking care of specific provincial interests (article 35 of the LBRL). For further responsibilities, the provinces depend on delegation by the Autonomous Communities and attribution by national sector law. Some Autonomous Communities use the provinces as an intermediate level of administration; other Communities bypass the provinces, creating their own intermediate level of government – the comarcas – or do business directly with the municipalities. All in all, the provinces seem to be caught in a downward spiral (Carballeira Rivera 1991; Carillo

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1997), and in any event do not serve as a general solution for the problems of small scale local government. The recent reform of the LBRL, through the December 16th Law 57/2003 on Measures for the Modernisation of Local Government, stipulates new tasks for the provinces, the promotion of social economic development and strategic planning, without creating new formal competencies, for instance. It is too early to tell whether this will have any impact on the relations with local government, or on inter-municipal cooperation in the sectors mentioned. The 1978 Constitution, for the first time in the history of Spanish public administration, recognised the principle of local autonomy and highlighted the necessity to pass a basic law of local regime in accordance with the principles of the Constitution. On this point, we should ask what competences the municipalities have. Articles 25 and 26 of the LBRL provide the answer. They do not contain a list of specific local competences, but Article 25 recognises the competence of municipalities in matters of security in public places, traffic on urban roads, fire prevention, town planning, housing, public parks, cultural and historical heritage, environmental protection, markets, cemeteries, water supply, cleaning of the city, street lighting, public transport and tourism, among others. According to the principle of local autonomy, every sectoral law of the State (on the environment, health and so on) and of the Autonomous Community must give competences to the municipalities in those matters mentioned by Article 25. Moreover, Article 26 establishes the obligatory services to be provided by all the municipalities. The list of this provision contains minimal public services according to the population of the municipality, dividing municipalities at 5,000, 20,000 and 50,000 inhabitants. They may provide other services if their budget allows; it is, however, illegal to supply a public service that is not compulsory (for example, public transport in a municipality of less than 50.000 habitants) if a municipality fails to supply one of the basic mandatory services (cemetery, cleaning, street lights, water, etc.). In addition to realising public works and services, the LBRL recognises that municipalities may exercise public initiatives for the realisation of economic activities. When we confront the legal provisions concerning local government with the scale of Spanish local government – especially with respect to the regime’s implications that vary with the size of municipalities – it provides ample insight into the need for inter-municipal cooperation. Spanish local government is for the greater part microscopic (see Table 1). Table 1: Municipalities according to size (2006) 2 Population < 250 250 – 1000 1000 – 2000 2000 – 5000 5000 – 10000 10000 – 20000 20000 – 50000 50000 – 100000 > 100000

Number of municipalities 2527 2417 1003 1001 509 332 201 62 56

Cumulative 2527 4944 5947 6948 7457 7789 7990 8052 8108

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What stands out is the fact that more than 85 percent of the municipalities have fewer than 5000 inhabitants, a population that in some northern European countries is considered too small to provide even the most basic public services. 2. Origins and Evolution of Inter-municipal Cooperation in Spain Inter-municipal cooperation in Spain has its historical origin in the Cadiz Constitution of 1812, specifically with the adoption of the French municipal system that arose as a result of the 1789 French Revolution. The latter approached the construction of the contemporary local state regime on the basis of principles of equality, eradicating the system of privileged municipal autocracy with the consequent generalisation of municipalities throughout French territory. In Spain, following the Cadiz Constitution, town councils were created in those villages where they did not previously exist and it became obligatory “in those villages with 1000 persons or more to be signposted with the corresponding term” (Article 310 Constitution of Cadiz) (Posada 1982: 63). Except for absolutist periods, this system remained in force for many years until the legal project of 12 November 1860 (presented by D. Jose Posada Herrera), which included the then current tendency to extend the minimum municipal unit. A consciousness already existed at this time of the serious inconveniences caused by microscopic municipalities. From this moment on, when the formation of "administrative municipal unions" was authorised, all attempts at reform of local regimes increased the presence of associations and communities of municipalities for such things as the construction and conservation of roads and neighbourhood improvements. In the regulation immediately prior to the present one, the creation of a voluntary mancomunidad for carrying out construction works, services and other objectives of municipal competence was created as well as establishing by governmental decree the forced Agrupaciones of various bordering municipalities, aimed at providing obligatory public service of municipal competence for the realisation of state subsidised public works or the maintenance of a Common Secretary and so on.3 The Administrative Consortia arose later than the mancomunidad of municipalities. Entities called Consortia existed although they were not really such.4 The Reglamento de Servicios de las Corporaciones Locales (RS) of 19555 regulated for the first time in Spain the Administrative Consortium. This Regulation defines the Consortium as a corporation, that is, an association of entities of Public Law, with legal status for the achievement of its aims, having a voluntary character and subject to Public Law. The heterogeneity of the parties in a Consortium has been the defining point in the institution from the beginning, distinguishing it from the mancomunidades and agrupaciones municipales.6 The RS introduced the vertical interadministrative cooperation in which at least one local corporation should participate.7 Having satisfied this requirement, the other components of the Consortium could be of different nature such as mancomunidades, provincial deputations, the State Administration and, since the 1978 Constitution, the Autonomous Communities.

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Together with the municipal crises initiated in the last 30 years of the 19th century, a consequence of the inappropriateness demonstrated by microscopic municipalities set up in Spain after the Constitution of Cadiz, there was a generalised growth of cities resulting from the industrial revolution. Nevertheless, the Metropolitan Area as a solution of a legal code for the problems created by urban areas came much later. In Spain, as in other neighbouring countries,8 the precedent of Metropolitan Administration is set by the ‘annexation’9 phenomenon; a faithful reflection of this can be found in the suburbs initiated in the last 30 years of the 19th century in Barcelona, Madrid, Bilbao and other cities (Martin Mateo 1987: 215. The first regulation to deal with the problems of large cities dated from the 1940s. At this time the Law of Town Planning of Madrid and its surroundings was approved in 1944, Gran Bilbao in 1945, Gran Valencia in 1946, and Gran Barcelona in 1953. All these laws created a system of town planning for the Metropolitan zone, which included various municipalities. The second phase of development of the Metropolitan regime in Spain began in the 1960s and departed from the annexation tendency, which had demonstrated its ineffectiveness for resolving serious urban problems. The reality of immediate problems surpassed those of simple town planning and affected public services such as transport, water supply and waste disposal. The Law of November 7, 1957 authorised the government to grant a special organic and economic regime to Madrid and Barcelona.10 In the second phase, as along with overcoming the purely urban aspects of Metropolitan Administration, local competencies were strengthened. Along these lines, the Special Law of Barcelona created the municipal entity of Barcelona with authority to manage the Metropolitan Area. The same cannot be said of the special Law of Madrid which centred essentially on town planning aspects, creating a Comisión de Planeamiento y Coordinación del Area Metropolitana as an autonomous organ under the auspices of the Ministry of Housing. With the passing of the Spanish Constitution in 1978, the evolutionary line hitherto described – which had proved totally insufficient for the resolution of the Metropolitan problem – came to an end. Title VIII of the constitution announced an important reform of local regimes that has substantially modified the legal code in which the municipal corporation was developed. A reform was drafted with two fundamental parameters: that boundary territories might constitute an Autonomous Community (Article 143 CE) and that the principle of autonomy for local corporations be recognized (Articles 137 and 140 CE). Regarding the first aspect, article 148.1 2a of the constitution authorises the Autonomous Communities to take charge of "alterations of municipal boundaries within their territories and in general the functions corresponding to the State Administration for Local Corporations and whose transference gives legislative authority to the local regime”. This habilitating title, which is included in all the Autonomous Statutes, has led to the existence of autonomic legislation in matters of local regime and frequently regulates the mancomunidades of municipalities and, more sporadically, the Administrative Consortium and Metropolitan Area, although with few innovations with respect to State legislation.

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With regard to the second aspect of the constitutional reform, the principle of autonomy recognised in the local corporations prevents their decision from being submitted to a control of opportunity by other territorial Administrations. The latter has conditioned the procedure of constitution of municipal cooperations as Administrative Consortia and their statutes do not require the approval of the national government. Recognition of the principle of autonomy of local entities assumes the rupture with the conception that was held when passing the Constitution of 1978. At that time, it was understood that the local entities were hierarchically subordinated to State Administration.11 With regard to inter-municipal cooperation, an essential aspect of the principle of local autonomy, it is worth highlighting the necessity that local entities participate in matters that coincide with local interests.12 Finally, it must be added that the legal code generated by the 1978 Constitution highlighted the necessity of passing a law of local regime in accordance with the constitutional principles. The result of this general approach and of the exclusive State competence in foundation matters of a basic legal regime of Public Administration attributed to the State by article 149.1.18 of the constitution is Law 7/1985 April 2, Reguladora de las Bases del Regimen Local (LBRL), the dispositions of which are crucial for the study of the inter-municipal cooperation in Spain. 3. Present-day Data Relative to Inter-municipal Cooperation in Spain The Spanish Constitution and the principle of local autonomy have favoured the creation of entities of inter-municipal cooperation in Spain, a country with 8,108 municipalities,13 many of which are very small and have few economic and technical resources. This explains why, as a result of the 1978 Constitution and especially in recent years, inter-municipal cooperation has increased considerably, reaching the current 1,912 entities, municipal mancomunidades, Administrative Consortia and Metropolitan Areas.14 Table 2 shows the distribution of these entities throughout the 17 Autonomous Spanish Communities. The aims of these entities vary considerably. In the following section, we describe the characteristics of each, emphasising that mancomunidades, as entities partial to inter-municipal cooperation, have a general vocation to satisfy the different needs of its member municipalities.15 This does not mean that it would be impossible to find an example of a mancomunidad with a single objective and limited to the provision of a specific public service. The Administrative Consortium usually has a more immediate end. Consortia are created to satisfy a current necessity of several public authorities as, for example, the financing and management of the Liceo Theatre in Barcelona, the management of a municipal museum, or the organisation of the Olympic Games. The four Metropolitan Areas that exist in Spain are located in the Valencia community and in Catalonia. Their objectives are limited compared to Consortia and mancomunidades, and generally involve the provision of the urban and inter-urban transport services, the water supply and waste collection and treatment.16

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Table 2: An overview of different types of cooperation (2006) Autonomous Community Andalucía Aragón Asturias Canary Isles Cantabria Castilla- León Castilla- La Mancha Catalonia Extremadura Galicia Balearics La Rioja Madrid Murcia Navarra Valencia TOTAL

Mancomunidades Administrative Consortia 88 254 68 22 17 14 20 17 18 4 216 48 122 30 75 247 83 25 43 21 7 84 25 2 41 38 10 20 64 11 56 54 953 891

Metropolitan Areas 0 0 0 0 0 0 0 2 0 0 0 0 0 0 0 2 4

Total 342 90 31 37 22 264 152 324 108 64 91 27 79 30 75 112 1912

There is no logic to explain why Catalonia and Andalusia have more Consortia than the other autonomous communities or why 30 of the 38 Consortia in Madrid have an urban finality. In each autonomous community, much depends on the advisors or the preferences of the government in office and on whether the consultants in question are aware of the possible competencies of each entity. The position of the Autonomous Community is important, because financial incentives and funds are often linked to the preferred form of cooperation (Font & Parrado Diez 2000). In general, however, there seems to be a tendency towards Consortia. While the number of mancomunidades rose substantially from 1985 resulting in 882 mancomunidades in 1998 (against 428 Consortia), growth rate has slowed since then. From 1990 on, the Consortia are on their way up, resulting in an almost equal number of both forms of cooperation in 2006 (Table 2; Font & Parrado Diez 2000). 4. Mancomunidades of Municipalities After describing the data of municipal associations in Spain, this section presents a brief analysis of their regulation, aim and legal regime, and the problems that these present. The mancomunidades are regulated in Article 44 of the LBRL of 1985 and, for reasons of its basic character, should be respected by the autonomic legislation approved for this matter.17 In state regulation on municipal associations as well as articles 44 LBRL we can find articles 35-37 of the current Recompiled Text of Legal Dispositions (TR) on local regime matters of 198618 and articles 31-39 of the Reglamento de Población y Demarcación Territorial de Entidades Locales19 (RPDT). However, these precepts do not have a basic character and

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could therefore be substituted by the autonomous regulation. Finally, the functioning of mancomunidades is subject to their own statutes and to the regulations that apply for the policy sector in which they undertake activities. The Assembly of the future mancomunidad must draw up the statutes and the provincial council in question must issue a report about the same. The final approval must be preceded by public notification of one month (Article 44.3 LBRL, 35.3 TR and 35 RPDT).20 The final approval of the statutes corresponds to the town council meetings integrated in the mancomunidad (Article 44.3 c), LBRL). Once the constitution of the mancomunidad and the statutes has been approved, the new entity must be entered into the Register of Local Entities located in the Ministry of Public Administration.21 The statutes should contain the territorial area of the mancomunidad, which corresponds to the group of municipalities of which it forms part (Article 44.2 LBRL). The TR accepts the association of municipalities in a mancomunidad from different provinces without territorial continuity (Article 35.1). However, the Supreme Court, in its sentence of November 2, 1995,22 manifested its opposition, firstly, to the constitution of municipal mancomunidades from different Autonomous Communities and, secondly, to the incorporation of new municipalities within pre-existing mancomunidades when members of the former belong to a different Autonomous Community. Law 57/2003 on Measures for the Modernisation of Local Government put an end to this restriction, allowing municipalities from different Autonomous Communities to participate in the same mancomunidad, if so permitted by legislation of the Autonomous Communities involved (Article 44.5). A mancomunidad statute should contain certain minimal provisions concerning23 its aim, its areas of authority attributed by the municipalities and its governing bodies, which will be represented by the associated Town Councils. Whatever the case, it will consist of an Assembly or Board of Directors made up of representatives of the Town Councils with a president, vice president, several members and a secretary.24 The statute must establish the headquarters, the members or representatives of each town council and the manner of their designation.25 They should also indicate the association’s financial sources (such as contributions, published prices, taxes, fines, subsidies, and donations).26 Finally, the statute should include the procedure for the modification and dissolution of the mancomunidad.27 To this effect, Article 47.2º g) LBRL establishes that agreements regarding the creation, modification and dissolution of the association together with the approval and modification of the statutes should be approved by absolute majority of the legal number of members of the municipality. Furthermore, each local council must approve its participation in the budget of the mancomunidad. The legislation does not contain any provisions regulating the accountability of the members of the Assembly to their respective local councils. Once the legal regime of the mancomunidad has been examined in general terms, we will analyse its functions and aims, attempting to answer the question: Why have various municipalities decided to join forces as a mancomunidad? Article 44.1 LBRL recognises "the right of municipalities to associate in the form of mancomunidades for the common execution of specific public works and services of their competence" [author’s italics].28 Regarding municipal public works or local works, Article 88 TR considers these as "all new construction, reform, repair or mainte-

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nance carried out by local entities, either with their own funds or with the help of other public or private entities for the realisation of services within their competence".29 Therefore, a mancomunidad could supply public services or execute public works within the competences of its municipalities. In this context is a polemic subject: the provision of public services by the mancomunidad for municipalities that, because of their size, have not been attributed with this competence. I refer specifically to the creation of the ‘locally associated police service’ of the Balearics. The Sentence of the High Court of the Balearics (Tribunal Superior de Justicia), 26 January 1990, annulled the agreements of this service because none of the associated municipalities had more than 5000 inhabitants.30 However, the Supreme Court revoked the sentence, declaring valid the agreements of the Association Pla de Mallorca concerning the creation of a service of associated local police.31 The reasons given by the Supreme Court were based on the European Charter of Local Autonomy – which recognises the right of municipalities to associate with other Associations – and the competence held by the mancomunidades regarding public safety, traffic regulation, and urban pedestrian activity. In fact, the Parliament of the Balearics had approved Law 10/1988 of October 26 for the Coordination of the Local Police which, in spite of being posterior to the contested agreements and still pending the ratification of unconstitutionality, permitted the constitution of mancomunidades for the provision of common services of local police (first additional disposition of the Balearics Law). Also, the aforementioned Sentence of the Supreme Court referred to the municipal character of the local police service granted by the Ley Orgánica 2/1986 of March 13 of the State Security Forces. But, the Sentence of the Constitutional Court of February 11, 1993 (STC 49/1993) excluded the provision of a local police service through a mancomunidad. The outcome of the polemic seems to be that it is not admissible for a mancomunidad to provide a public service to which the municipalities alone, taking into account their population, do not have competence. In other words, the mancomunidad cannot be a vehicle for municipalities to obtain more competences. Undisputed is the multi-purpose character of the mancomunidad. Municipalities may transfer a series of tasks to mancomunidades as long as they do not entail the totality of municipal competencies. We are faced with a local entity with multiple objectives, that is, a breadth of objectives that has been the determining factor for the development and implantation of this aspect in the autonomic rulings. In fact, it has been said that “if any item characterises this Entity in its present definition it is precisely this breadth of aims” (Barrero Rodriguez, 1994). The pluralism of the functions of the mancomunidad has its ruling foundations in several provisions32 but above all, in Article 36 2º of the RPTD, which states: “The adhesion – of other municipalities – can take place for one, various or all of the objectives of the association, when the works or services are independent of each other, regarding their technical or financial aspects”. The State Council, in accordance with the principle of municipal autonomy (article 137 and more specifically article 140 CE), supports the possible reception on the part of the mancomunidad of an extensive range of municipal competencies, without this implying a stripping of municipal responsibilities in favour of the interposed entities.33 The mancomunidad must respect in every

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case the substantivity of the municipality and the governing functions and administration attributed by the Constitution (Quintana López 1990).34 The plural function of the mancomunidades seems to respond to the necessity to unite financial and technical initiatives for providing a variety of public services, which would otherwise be excessive for many Spanish town halls. Only by integrating in mancomunidades or analogous instruments can the public services that contemporary society demands be provided. The normative and doctrinal backing for the plurality of objectives of the Associations has furthered a practice where a variety of public services is a subject of inter-municipal cooperation and where individual mancomunidades integrate a series of tasks and services. Nevertheless, there are many mancomunidades that have only one purpose, about 40 percent of the total of 953 (Font et al. 1999: 11). Single-purpose mancomunidades are typically engaged in tasks like water distribution, waste disposal or the management of cemetery services. A typical example of a multi-purpose entity is the Mancomunidad of Penedés y Garraf, comprising 13 municipalities for the provision of 10 public services, including the creation and management of a plant for the treatment of solid urban residues; the creation and maintenance of services for search, collection, purification and distribution of water; slaughterhouse services and local markets; information and youth counselling services; the protection and education of the physically and mentally handicapped; and information technology of municipalities.35, 36

Table 3 provides an overview of the tasks and public services delegated to mancomunidades. Table 3: The different tasks of the mancomunidades37 Task or public service Water provision Waste disposal Fire brigade Social work Waste water treatment Information technology Town planning Machinery Public transport Environment Tourism Industrialization Slaughter houses and markets

Number of mancomunidades involved 292 524 248 309 164 66 251 93 103 199 270 251 157

There are no hard data available on the overall performance of mancomunidades that give insight in the quality and efficiency of the services rendered and in the efficacy of the coordination of local policies. The still growing number of mancomuni-

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dades shows that they are vital to overcome the fragmentation of local government and to profit from economies of scale. Anecdotal evidence suggests, however, that both the multi-purpose character and the fact that all participating municipalities – frequently a large number – have equal status in the governing of the entities makes for slow and inefficient management of common tasks. Realizing the principles of political representation and accountability is not without costs in terms of efficient and effective management. Moreover, in many cases the mancomunidades depend solely on the contributions of the participating municipalities, where the financial position of local government is generally poor. Both factors can explain the growing popularity of the other dominant form of cooperation: the Consortia (Font & Parrado Diez 2000). 5.

The Metropolitan Area

The original aim of the Metropolitan Area was the town planning of the zone of municipal influence. This was widened progressively from the 1960s, evolving into the rationalisation and coordination of public services in urban planning. At present, the Metropolitan Area can be described as is a group of urban nuclei intensely interrelated, to the extent of forming a homogenous block, "a single social economic unit or family" (Suay Rincón 1995). The LBRL describes a wide concept of the Metropolitan Area: "[T]he Metropolitan Areas are local entities integrated by the municipalities of large urban agglomerations where social and economic links exist within the nuclei of the population making a joint planning and coordination of specific services and works necessary” (Article 43.2º). Even though urban planning is an essential objective of the Metropolitan Area, it does not define the group of functions developed by these local entities at all. These entities are not very numerous in practice and were created with the purpose to absorb all the works and services needing development in the town planning of the big city. Unlike mancomunidades and Consortia, they are created by autonomic law (Article 43.1 LBRL) and are only constituted in urban zones.38 Metropolitan Areas differ in one important aspect from mancomunidades. The former primarily serve as a means to decentralize competencies from the Autonomous Communities to municipalities under the condition of cooperation. As such, the competencies of the Metropolitan Area must derive from the Autonomous Community itself, although once established, it is understood that the Metropolitan Area can also serve as an instrument for the execution of local tasks and competencies, either on a voluntary basis or as a consequence of provisions in the autonomous law. Mancomunidades, on the other hand, can only exert the competencies delegated by the municipalities, i.e., those that pertain to the domain of local government (Barrero Rodriguez, 2004). Autonomous Communities enact a law ad hoc for each Metropolitan Area which, according to the basic State legislation on local regime (LBRL) must establish “the organs of government and administration where all the municipalities integrated in the area are represented, the economic regime and functions which guarantee the participation of all the municipalities in the taking of decisions and a fair distribution of the appointments among them, and also the services and works of Metropolitan provision or realisation and the procedure for their execution” (3º paragraph Article 43 LBRL).

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Before creating the Metropolitan Area, the Autonomous Community must hear all parties involved.39 Regarding the organs of government, Article 43.3 LBRL imposes the representation of all the integrating municipalities of the Metropolitan Area. The organs of the Metropolitan Area are the usual ones for local entities: the Council, president of the Council (and therefore of the area), a vice president, the government commission, and perhaps an administrator. In each case the autonomic law of the area is responsible for the definition of the organs of the entity. Also the organisation of the Metropolitan Area will vary according to the generic or specific character of the competence attributed to it. It is even possible that the area may possess an instrumental administration for the realisation of certain common works and services. Once the Constitution of the Metropolitan Area is approved, it is registered in the Register of Local Entities.40 This inscription does not have constitutive effect and is purely declarative (Article 3.f, Regulation of the Register).41 Article 43.LBRL insinuates the double function of this entity: on the one hand, the Metropolitan Area can have as objective the joint planning and coordination of certain services and works, and on the other hand, it can constitute itself for the provision of certain services and the realisation of works. The actual functions are to be determined by the Autonomous Communities. To date, only two Communities, Valencia and Catalonia, have established Metropolitan Areas, although autonomous legislation of Galicia, Aragón, Murcia, Andalucía, Castilla-León and Madrid provides a basis and general rules for their establishment in the respective Autonomous Communities (Barrero Rodríguez, 2004). After the Spanish Constitution of 1978, the Autonomous Community of Valencia created the Consell Metropolitá del L’Horta,42 a local entity determined by grouping municipalities, with legal status and full capacity to carry out their objectives. The law indicated some very broad objectives to the Consell, an extensive framework of competence with an area of power that Article 4.1º LBRL attributes to the local territorial entities. This model of Metropolitan Area, destined to satisfy the general necessities of the collective that it represented, was valued positively although its realisation caused serious inconveniences;43 on one hand, the lack of direct attribution of competence made the Metropolitan administration dependent on the autonomous policies of the moment44 and on the other, the composition of the Corporation by the Mayors of the affected municipalities left the decisions of the Consell in the hands of the dominant political force, contrary to the democratic principles by which metropolitan governance should reflect the political spectre of the local entities (Barrero Rodríguez 1993: 261). These inconveniences provoked the passing of Law 4/1995 of March 16 of the Área Metropolitana de l’Horta in an attempt to mitigate the Consell’s most notable dysfunctions. Its two principal objectives were to limit with precision the functions and competencies of the Metropolitan entity and assure the representation of the political plurality of each municipality in the Corporation of the entity (Articles 13, 14 and 15). In practice, the political plurality hampered the effective management of the new authority and it was dissolved in 1999. In its place two less politically based Metropolitan entities were established, resulting in easier and more agile management. Law 2/2001 of May 11 for Creation and Management of Metropolitan Areas of the Valencia Community created the Metropolitan Entity of Hydraulic Services and the

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Metropolitan Entity for Treatment of Waste. The first was responsible for more than 40 boundary municipalities in questions of depuration, storage and supply of water to the city of Valencia.45 The latter has as objective the collection and elimination of rubbish and road cleaning of 45 adjacent municipalities of the city of Valencia. Regarding Catalonia, the autonomous legislator in 1987 created two Metropolitan entities to satisfy two specific areas: transport, and hydraulic services and waste treatment:46 The Entidad Metropiolitana de Transporte and the Entidad Metropolitana de Servicios Hidráulicos y Residuos Sólidos continue in operation today. The former covers 18 municipalities, including that of Barcelona. To give an idea of the importance and volume of the activity of this entity we must take into account that it participates in two Consortia and five public enterprises. The latter, which is also called Entitat del medi ambient, consists of 33 municipalities including that of Barcelona, and presently participates in three Consortia and four public enterprises. This model of Metropolitan Administration was subject to strong criticism because it increased the jumble of concurrent public administrations in the local Catalan area (we must add to the two Metropolitan entities the municipalities, comarcas, provinces and other functional entities), resulting in the almost impossible task of defining the limitations of the respective competencies (Martín Mateo 1987: 245; Barrero Rodríguez 1993: 233-234 and 276-277). Nevertheless, the continuance of these entities in Catalonia throughout the years suggests that their management has been efficient. One of the more salient aspects of the Metropolitan Administration in the Barcelona area is that it does not engage in urban planning, one of the original motives for the creation of the administrative model of the Metropolitan Area. Urban planning, or Plan General de Ordenación Urbana, has been delegated to the mancomunidad that the municipalities established for the Barcelona metropolitan area. The Metropolitan Area clearly has not developed into a type of general metropolitan government integrating decentralized competencies of the Autonomous Community with tasks and competencies of local government in the urban agglomerations, as is the case in some other European countries (France, the Netherlands). The challenges posed by the metropolis made up of a large a number of municipalities seem to be addressed in two ways. The first is that both coordination of local policies and large-scale service delivery is provided by the Autonomous Community itself. An example is the Autonomous Community of Madrid, which actually functions as the government of metropolitan Madrid (Tomás 2002). The second is the use of multi-purpose mancomunidades with wide range of tasks and competencies, up to the point where they sometimes take up responsibilities that, properly speaking, belong to the Autonomous Communities, e.g, supra-municipal spatial planning. This is the case in a number of metropolitan areas in Andalusia. Irrespective of the issue of legality, it seems clear that this type of mancomunidad is a viable alternative for the Metropolitan Area (Barrero Rodríguez 2004). 6. The Administrative Consortium The administrative Consortium is, along with the mancomunidad, the entity of administrative cooperation most used in Spain, although it is not exclusively an entity

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of inter-municipal cooperation. In fact, its most distinctive characteristic is a heterogeneous composition that is not limited to entities of a local character. A brief explanation of its regulation and legal regime follows, highlighting those aspects that present the greatest problems. The scant regulation of the administrative Consortium by the LBRL, specifically Article 87, underlines the importance of the regulation contained in other State rulings.47 Moreover, we must add the norms established by the respective Autonomous Communities, although to date, the autonomic dispositions that affect the legal regime of the Consortia are few.48 In addition, the term ‘Consortium’ has been regulated for general application, i.e., outside the local area, by Law 30/1992 November 26, of Régimen Jurídico de las Administraciones Públicas y Procedimiento Administrativo Común (LAP), or Administrative Procedure Act. The fifth paragraph of Article 6 of this law establishes the possibility of forming Consortia of mercantile societies by the government or by the governing organs of the autonomous communities when the management of a collaboration agreement requires a common organisation.49 It is the first time that the normative system regulates the constitution of Consortia without the participation of any local entity. As far as we know, this has yet to become a reality. The contemporary administrative Consortium can be defined as an instrumental association of Public Law. The institutions involved in a Consortium are members of the entity and not merely its administrators. Their contributions constitute the patrimony of the entity. Consequently, we are faced with an association of instrumental character, as the objectives of the Consortium fall within the potential orbit of its members. The latter are politically responsible for the effective realisation of the objectives assumed by the Consortium. For that reason, the Consortium is defined as an instrumental association of Public Law and, although Article 87 LBRL admits the participation of private non profit entities, the Law maintains the public form of embodiment. Consortia differ from other instruments of administrative cooperation (such as mancomunidades) due to the presence of three essential elements: heterogeneous composition, singular objectives and the necessary existence of a standing organisation. Firstly, its heterogeneous character follows from the fact that the Consortium can be made up of municipalities as well as provincial deputations, the Autonomous Community, the State and, sometimes, some non profit entities. Secondly, the singular objectives constitute a characteristic trait of the administrative Consortium. This does not mean that all administrative Consortia have a single objective. As opposed to the municipal mancomunidad (whose reason to be is the resolution of situations of financial and technical insufficiency in the numerous municipalities of our country), the administrative Consortium arises in answer to the immediate necessity of various public administrations with parallel interests. The organisation of the Barcelona Olympic Games of 1992 is a good example.50 Finally, the necessary existence of a standing organisation allows for the distinction of Consortia from cooperation agreements. In fact, the fifth paragraph of Article 6 of the LAP establishes the possibility of constituting Consortia between the State Administration and the Autonomous Communities when the management of a collaboration agreement makes it necessary.

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The facts that (1) the LBRL does not mention Consortia as one of the basic forms of inter-municipal cooperation, (2) Consortia admit the participation of non profit private parties and (3) the LAP allows for Consortia with the State Administration and the Autonomies Communities as the only constituting members have promoted the thesis that Consortia cannot be considered local entities. If it is not a local entity what legal regulation should be applied when there is no statutory disposition: the local legislation, the autonomic or the State, public or private law? The issue proved relevant for managers of some Consortia, for example, because they could not obtain the fiscal benefits local entities have.51 The answer to the question of which (public) legal regime applies must be established case by case, depending on the administrative Consortium in question. This analysis can be seen in the Sentence of the Supreme Court April 30, 1999.52 The essential data to be considered is that of the effective control of the organs of government of the Consortium. If a Consortium is controlled by local entities, the rulings of local regime approved by the corresponding Autonomous Community (or the State dispositions that regulate the legal regime for local entities) will apply. Similarly, if the effective control of the Consortium lies with either the Autonomous Community or the State, the rules of governance and legal regime of these entities will apply. The question of the applicability of different legal regimes also touches upon the institutional design and governance of the Consortia. Although the basic rules of the entity are the statutes approved by the constituting member entities, the statutes cannot include any clauses contrary to the legislation in force. As State legislation only provides for general stipulations, institutional characteristics of the Consortia in practice largely depend on autonomic legislation. The case of Andalusia is illustrative. In the first place, the Law of Municipal Demarcation of Andalusia attributes the Consortia public legal status, so there is no doubt about the applicability of public or private legal regimes. Secondly, the law stipulates minimum requirements for the statutes: the list of entities, institutions and organisms in the Consortium; the aims pursued; the structural regime; the functional structure; the financial regime, both budget and accountancy; the duration of the entity; the procedures for alterations; and dissolution and liquidation and the procedure for the modification of the statutes (Article 36.1). The Consortium is constituted for the realisation of aims of common interest for the participating administration or public interest, parallel to those of the Public Administration in cases where intervention of a private non-profit making legal entity is involved (Article 87 LBRL and 110.1 TR). Its statutes contain very diverse aims: training young professionals and promotion of employment in the area, the diffusion of local and foreign culture, social services, forestry and environment, consumption, town planning, waste treatment and even mediation and conciliation of Local Administration. Of the 254 Consortia in existence in the Autonomous Community of Andalusia, some have environmental aims (Consorcio Via Verde Coripe-Montellano). Fifteen others support local development; others yet have to do with the promotion of tourism (Consorcio Ruta Bética and Consorcio de Turismo de Sevilla), or social assistance and labour development (Consorcio Escuela de

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Formación de Artesanos de Gelve and the Consorcio de Asistencia Social de San Roque). This list is not exhaustive. Regarding the constitution of Consortia, the State dispositions in force at present do not establish a procedure, not even minimum requirements. The Autonomous Communities must establish the procedure applicable to the case. The Law of Municipal Demarcation of Andalusia dedicates a simple precept to the procedure of constitution, specifically Article 36.2 which states: "The Statutes must be approved by all the entities in the Consortium in accordance with their specific legislation and returned to the Autonomous Community for inscription and publication in the Official Bulletin of the Junta de Andalusia". However, the Consortium constituted in accordance with this Law is subject to a basic rule of imperative law which imposes the approval with absolute majority of votes of the legal number of members of each local municipality for the creation of the entity (Article 47.2. g) LBRL).53 Where there is a lack of specific normative provision, the Consortium considers the general rule contained in Article 35 of the civil code to be applicable for the acquisition of legal status by the system of free constitution; that is, once the Consortium is validly constituted according to law, it is understood that it is attributed a legal status, and as an Entity, a legal capacity. Article 36.2 of the Law of Municipal Demarcation of Andalusia introduces novelties with respect to state regulation of the Consortium, referring to the necessary remission of the Statutes to the Autonomous Community to proceed to the inscription and publication in the Official Bulletin of the Junta de Andalusia. This provision of the Registry inscription is surprising in Andalusian law as, in the Register of Local Entities of this community, the inscription of Consortia is not contemplated, and contrary to what happens in Catalonia, a complementary section for this type of entity does not exist. The Statutes will determine the procedure of its modification as well as the conditions for alteration, dissolution and liquidation of the entity. Whatever the case, it is evident that the procedure will vary according to the transcendence of the decision adopted; i.e., in some cases the adoption of an agreement by the general assembly will be sufficient, for example, when a new member is admitted or when one leaves without this affecting the functioning of the entity. In other cases, it will be necessary for the agreement adopted by the assembly to be ratified by the organs of government of the member entities, for example, when the decision implies a change in the original aims and objectives of the Consortium. The associative and instrumental nature of Consortia implies an auto administration that is put into practice by at least two organs: one deliberately far reaching and in which all the members are represented (the Assembly), and another with executive functions for the decisions adopted by the Assembly. The latter can be one person (Director or Administrator) or a collective, but is always integrated by a lesser number of representatives than in the Assembly. In this sense, Article 110.4 4º TR imposes the necessary representation of all the members in the organs of the Consortium, in a fixed proportion of the respective statutes. An important subject is the criteria to follow for the determination of the representation which each member holds in the Consortium’s Assembly. The present law does not establish anything regarding the criteria to be followed to determine the representation of each entity. In effect, the drafting of the 4º paragraph of Article 110 TR stipulates that all the

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participants must be represented in the organs of government, but does not establish an equal representation for the members of the Consortium and neither does it indicate how this should be determined, referring only to what is stated in the Statutes. In my opinion, due to the heterogeneous composition of this concept, using criteria on the economic participation of each member of the Consortium is preferable. Regarding the functioning of the Consortium, the present legislation refers back to the Statutes, which must establish the rules of operation.54 On the management modalities of public services, the current regulation established that the Consortium can use whichever management form is accepted in the legislation of the local regime, specifically, those numbered in articles 85.2 LBRL (Article 110.5 TR and Article 40 RS). The legislation from the Autonomous Community dictated to date reiterates the forms of management of services established by the LBRL and habilitates the Consortium to use any of these. Both the forms of direct and indirect management are suitable. However, the former seem to be more adequate for the structure and objectives of the entity of associations. Among the management forms, direct management by the entity itself is preferable, or management through a mercantile society where the capital belongs entirely to the Consortium entity. The statutes of the entity should decide the legal regime of the staff, that is, they should opt for the employment of civil servants or personnel subject to labour contracts. Also, it should determine if the persons are subscribed to the member administrations of the entity or if not, if they will be employees of the Consortium itself, in which case (as there is no autonomic regulation on this) the articles regulating public employment and the procedure for the selection of personnel in all the public sector will apply.55 When the statutes establish, on the basis of the Consortium’s aims and type of management, that the Consortium will operate with hired personnel subject to Labour Laws, constitutional principles must be applied for their selection (merit, capacity, quality and consequently, public announcement) and the same rules applicable to people wishing to enter the civil service (according to the supply of public employment through public notification and system of public selection, exam or open examination). Regarding the properties of the entity, Law 33/2003 on Patrimony of the Public Administrations (LPAP) put an end to the classic theories that, on the one hand, refuted that the instrumental Administration as the Consortium could possess patrimony and on the other, that the ownership of goods of public property was attributed to the territorial Administration, denying ownership to the galaxy of instrumental public administrations. Consequently, until the passing of the aforementioned Law, only the adscription of properties to the Consortium on the part of the Public Administrations integrated in the Consortium was recognised. The LPAP accepts that both the territorial and the instrumental administration can be owners of public goods. It corresponds to the Director General of State Patrimony or the Presidents and Directors of public organisms exercising the faculties and prerogatives for the defence of public goods. In consequence, the Consortium can currently assume the ownership of public goods and according to the LPAP, it will be the President of the entity who will exercise the prerogatives in defence of its properties. As is the case with the mancomunidades, there are no hard data available on the overall performance of Consortia. Evidence from case studies suggests that the strength of the Consortia lies in the professional management of joint activities and

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the fact that through the Consortia local government is able to generate financial commitments from upper level government. Examples are the Consortium of Santiago de Compostela, where the city cooperates with both the Autonomous Community of Galicia and central government and the Consortium Greater Bilbao Water Partnership. The Consortium of Santiago de Compostela was set up in 1992 at the initiative of the city in an effort to attract public investments for the implementation of a general urbanization plan, the strategic answer to the rapid growth the city experienced in the 1990s. Initially the Management Office of the Consortium was closely related to the city and focused on the generation of public investments. Through the years it has developed into a more independent standing organization for the coordination of the actions of the three governments involved and for the execution of the decisions of the Council of the Consortium. Among other things, the Consortium is involved in building city facilities and public works, rehabilitation and preservation of monuments and private historic buildings and the promotion of cultural activities (Roig Sánchez 2001). The Greater Bilbao Water Partnership is a Consortium of 43 municipalities, the provincial government of Biscay, the Autonomous Basque Community and central government. Today it manages water supply and sewage treatment for a population of about one million. Originally only the municipalities had voting and executive powers in the Consortium, while the other partners provided the bulk of the financial funds for its operations. The organisation structure was based on the principles that the Consortium should be able to operate like a private company and that public partners should avoid any political interference with the technical decisions made by the staff of the Consortium. Throughout the years, the financial involvement of the provincial government of Biscay has grown and establishment of political relations between the Consortium and the provincial government became inevitable; the statutes have been reformed to grant the province both voting and executive powers (Font et al. 1999). Europe Finally, I must mention the introduction in the Spanish legal system of a new type of Administrative Consortium: the trans-frontier administrative Consortium. The Law 57/2003 on Measures for the Modernisation of Local Government added a second paragraph to Article 87 relative to the creation of Consortia in the framework of cooperative trans-frontier agreements in accordance with the provisions of international agreements ratified by Spain. These precepts adapt the LBRL to present-day reality, including the concept of the trans-frontier Consortia that were already being used by Basque and French municipalities. The European Union has tried to support and strengthen trans-frontier cooperation, emphasising the disadvantages suffered by the trans-frontier regions. Since 1999, Community initiatives have successively offered financial aid for adaptation to the exigencies of a single market for these regions and trans-frontier municipalities (IC Interreg). At the present moment, the Interreg approved for the period 2000-2006 is in force, geared towards trans-European cooperation and structure in the trans-border, trans-national and inter-regional cooperation. In addition to the

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Community initiative, Spain has ratified two international treaties on trans-frontier cooperation. The first, the Treaty of Bayonne of March 10, 1995 with France, came into force in 1997 and gave way to the creation of the first trans-national Consortium (Consorcio Bidassoa-Txingudi) and the trans-frontier Observatory of the Euro-city Bayonne-San Sebastian, qualified as a European Group of economic interest. The Consortium Bidassoa-Txingudi was created on December 23, 1997 with the Spanish municipalities of Irún, Fuenterrabía and the French city of Hendaye. 56 This Consortium explains the introduction of the second paragraph in the Article 87 LBRL by Law 57/2003. The most surprising aspect of this Consortium is its exclusively municipal composition, which in the Spanish regime would have been a determining factor for its qualification as a mancomunidad. The plural objectivity of the Consortium is also highlighted in order to satisfy the necessities of cooperation among the member municipalities. The second international treaty for trans-frontier cooperation ratified by Spain is the Treaty of Valencia, October 3, 2002, known by this name because it was signed between Spain and Portugal in the city of Valencia. It came into force on January 30, 2004 (Sobrido Prieto). This treaty gives legal coverage to the instruments of trans-frontier cooperation that are created, such as Consortia referred to in the second paragraph of Article 87 LBRL. 7. Conclusions Spanish municipalities have for the larger part been microscopic since their establishment. In contrast with some Northern European countries, Spain had had no territorial reorganisations to enlarge the scale of local government during the previous 100 years. The introduction of the welfare state, later and slower than in other European countries, did not have a big impact on the administrative position of the Spanish municipality. Due to the centralist organisation of the state under Franco’s authoritarian rule, state departments and their territorial branches, functional agencies and provinces were the main providers of public services. The transition to a democratic regime had a big impact on the position of local government. The Spanish Constitution of 1978 for the first time introduced the principle of local autonomy, and subsequent legislation on local administration defined a series of competencies and stipulated obligatory public services to be provided by local government according to their size. The combination of small-scale local government and a considerable set of municipal tasks and responsibilities has caused substantial growth in different forms of inter-municipal cooperation. In the last two decades, the situation has developed that almost every municipality participates in one or more entities of cooperation. Although the local government act stipulates a role for the provinces in assisting municipalities in public service delivery, it seems not to have been taken up, with some notable exceptions (the Basque country). In most Autonomous Communities, the provinces have not been able to shake off their aura of being instruments of the former authoritarian regime. Two forms of cooperation dominate the Spanish administrative space: the mancomunidad as a form of pure inter-municipal cooperation that is for the major part,

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although not exclusively, multi-purpose in character and covers a wide range of public services; and the Consortia, which incorporate public authorities from different levels of government, although some are exclusively inter-municipal. Consortia are predominantly single purpose, engage in concrete projects or objectives and embody standing organisations. New phenomena are the trans-border Consortia that have resulted from incentives created by European funding programs. Originally, Consortia were less popular than mancomunidades. A lack of clarity about the legal regime for the day-to-day operations of the Consortia and the fact that a Consortium is thought to be more fit to realize concrete objectives than to supply basic public services on a regular basis seem to explain this. Moreover, in some Autonomous Communities, like Castilla–La Mancha, there has been a lack of political will to establish Consortia. However, the Consortia have gained importance in the last decade, and today there are almost as many Consortia as mancomunidades. A third form of cooperation, the Metropolitan Area, is not frequently used in Spain. This is not because urban agglomerations do not need some form of metropolitan governance to coordinate local policies or to provide large-scale public services. The reason seems to be that the legal form does not provide any specific advantages or incentives compared to the two other forms of cooperation and that, for some urban agglomerations, the Autonomous Community functions as the actual metropolitan government (the case of Madrid). There are no hard data available on the performance of inter-municipal cooperation in Spain. No systematic research has been conducted into the quality and efficiency of public service delivery and the efficacy of coordination activities. The popularity of the mancomunidades and the Consortia, and the absence of horror stories about internal malfunctioning, conflicts between participants, financial disasters and failures to perform suggest that overall these two forms of cooperation satisfy the needs of the municipalities and other entities involved. At the same time, the growing number of Consortia relative to mancomunidades can be interpreted as a need for more flexible and effective management of cooperative entities. A special point of interest remains the political representation and accountability of the governing bodies of mancomunidades and Consortia. Especially in the case of the mancomunidades, the existing legislation and statutes express the importance of the relation between the cooperative entities and their constituting members: The governing bodies are composed of representatives of the municipalities, and representation somehow must reflect the weight of the participants or the political spectrum. Whether these institutional linkages between the mancomunidades on one hand and the participating actors on the other actually result in accountable supra- municipal governance is anything but clear, and would merit the attention of public administration researchers. A second issue concerns the link between the design of political representation and performance. Practical evidence from Metropolitan Areas and mancomunidades suggests that a highly politicised governing board that articulates the interests of the participants or reflects party political differences hampers effective decision making and management. Is there a trade-off between democracy and effective inter-municipal government? If so, would there not be a reason to address the microscopic character of Spanish local government, thereby preventing centralization and autonomization to

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hollow out the municipalities that only 30 years ago obtained constitutionally safeguarded autonomy? References Barrero Rodríguez, M.C. (1993). Las areas metropolitanas. Madrid: Civitas. Barrero Rodríguez, M.C. (1994). El juego de las entidades supramunicipales en España. Algunas reflexiones en el décimo aniversario de la ley de régimen local de 2 de abril de 1985. Revista de estudios de la administración local y autonómica, 264, 627-669. Barrero Rodríguez, M.C. (2002). Los conceptos de mancomunidades y consorcios: Necesidad de delimitación y diferenciaciones. Revista andaluza de administración pública 45, 81-119. Barrero Rodríguez, M.C. (2004). Las formulas posibles para el gobierno de los espacios metropolitanos: Las áreas metropolitanas. Paper presented at the internacional conference on local government in the xxi century. Municipia, Zaragoza. Carballeira Rivera, Ma Teresa. (1991). La autonomía provincial y la coordinación ínter administrativa. In Estudios en homenaje al Profesor Carlos G. Otero Díaz: Santiago de Compostela (pp. 217-248). Carrillo, E. (1997). Local government and strategies for decentralization in the state of the autonomies. Publius: The journal of federalism 27(4), 39-63. Cuchillo, M., & Morata, F. (1991). Organización y funcionamiento de las áreas metropolitanas. MAP. Esteve Pardo, J. (1991). Organización supramunicipal y sistema de articulación entre administración autonómica y de orden local: La experiencia en la RFA: Bases y perspectivas en España. Barcelona: Civitas–Diputació. Font, J., Gutiérrez Suárez, R., & Parrado Díez, S. (1999). Intergovernmental partnerships at the local level in Spain: Mancomunidades and consortia in a comparative perspective. Paris: OECD. Font, J., & Parrado Díez, S. (2001). Eligiendo socios en la administración municipal española: Los consorcios y las mancomunidades. Cuadernos de gobierno y de administración, 3. Madrid: Universidad Rey Juan Carlos. Giordano, B., & Roller, E. (2003). A comparison of city region dynamics in the UK, Spain and Italy: More similarities than differences? Regional studies, 37(9), 911-927. Junta de comunidades de Castilla–La Mancha: Mancomunidades de Castilla–la Mancha. (1994). Estudios y legislación. Out of print. López Menudo, T. (1995). Servicios municipales y gestión consorciada. VVAA, Jornadas de estudios sobre consorcios locales, CEMCI-TAL, 1-34. Martín Mateo, R. (1987). Entes locales complejos. Trivium. Nieto Garrido, E. (1997). El consorcio administrativo. Barcelona: Cedecs. Nieto Garrido, E. (2001). The legal nature of the administrative consortium in consequence of the Supreme Court Sentence of April 30, 1999. Revista de estudios de la administración local 285, 249-254. Posada, A. (1982). In Evolución legislativa de régimen local en España (1812-1909). Madrid: IEAL. Rodríguez Gutiérrez, F., Menéndez Fernández, R., & Cadenas Nevado, A. (2005). Comarcas, consorcios y otras experiencias innovadoras de cooperación territorial en España. Boletín de la asociación de geógrafos Españoles, 39, 177-199. Quintana López, T. (1990). In Las mancomunidades en nuestro derecho local. MAP. Roig Sánchez, B.A. (2001). Policy-making in central-autonomous-local government relations: The consortium of Santiago de Compostela. Paper presented at the ECPR joint sessions workshop, Local autonomy and local democracy. Grenoble. Sobrido Prieto, M. (year not specified). El tratado Hispano-Portugués sobre la cooperación transfronteriza territorial. Retrieved from www.reei.org. Sosa Wagner, F. (1995). La gestión de los servicios públicos locales, 2nd edition. Madrid: Civitas. Suay Rincón, J. (1992). Coordinación del transporte en las áreas metropolitanas: La formula del consorcio regional de transportes de Madrid. Documentación administrativa, 230-231, 321-334. Tambou, O. (1999). Le consorcio Bidassoa-Txingudi: The first public Franco-Spanish organism of transfrontier cooperation between local entities. Quaderns de treball, 32, 1-24. Tomás, M. (2002). Making metropolitan governance work. A case study: Madrid. Paper presented at the ECPR joint sessions workshop, The politics of metropolitan governance. Turin.

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Notes 1

This is despite the opposition of some of the Autonomous Communities, which considered the provinces as instruments of the cursed centralism. 2 Data from the Ministry of Public Administration available at http://www.dgal.map.es/cgibin/webapb/webdriver?MIval=REEL_mun_tramo_1. 3 In 1977 the borderline character of the municipalities stopped being requisite for the forced grouping of associations in questions of public works and State subsidised or delegated services. 4 For example, the Consorcio e Panadería de Madrid, the Consorcio Arrocero and the Marina Mercante. See Nieto Garrido (1997: 27-35). 5 Decree of June 17, 1955 in chapter 2, articles 37 to 40 of the Title III dedicated to the Services of Local Corporations. 6 Article 37.1RS establishes that the Corporaciones Locales "could constitute Consortia with Public Entities of a different order". 7 The Law 30/92 of November 26, Régimen Juridico y de Procedimiento Administrativo Común de las Admnistracions Públicas (LAP), introduced the constitution of Consortia without the participation of any local corporation for the management of Collaboration Agreements between the Central Government and the governmental organs of the Autonomous Communities. 8 See a study on comparative law concerning Metropolitan Areas by Cuchillo and Morata (1991). Also see Esteve Pardo (1991). 9 Annexing consists of subordinating the nuclei in populations bordering on the metropolis. 10 The result of this legislative delegation was the approval of two articulated texts passed by Decree 1166/1960 on 23 May (Special Law of Barcelona) and 1674/1963 on 11 June (Special Law of Madrid). 11 Sentence of the Supreme Court, 4 June 1963 (Aranzadi nº 3254). 12 Sentence 4/1981 February 2, FJ 3º of the Constitutional Court is fundamental to the principle of local autonomy and its implications. 13 Data from the Ministry of Public Administration available at http://www.dgal.map.es/cgibin/webapb/webdriver?MIval=REEL_mun_tramo_1. 14 Data from Ministry of Inland Revenue inventory Local Public Sector available at http://serviciosweb.minhac.es/apps/ispl/aspx/comh300.html. 15 For example the mancomunidad of Alto Henares within the autonomous community of Madrid was created in 1992 for rodent control and disinfection, public lighting, the collection and treatment of waste and highway cleaning of the associated municipalities. 16 See section 5. 17 The autonomous communities can enact legal provisions in these matters on the basis of that set out in article 148.1.2º.CE (alterations of municipal boundaries). 18 Real Decreto Legislativo 781/1986, April 18. 19 Real Decreto 1690/1986 July 11. 20 In the legislation in force for local regimes, the constitution of municipal associations has been established as a voluntary decision of the municipalities in question, and is not subject to a superior approval. (Opinion nº 49.436, September 18, 1986). 21 Articles 2.1 and 4.2 of the Royal Decree 380/1986, February 10. 22 STS 2nd November 1995, Aranzadi nº 8445. 23 Art. 44.2 LBRL, 36 TR and 34 RPTD. 24 Articles 140 Reglamento de Organización, Funcionamiento y Régimen Jurídico de los Entes Locales of November 28, 1986 (ROF), 37.3 and 39.3 RPDT. 25 Referring to the election of representatives of each Town Council and the criteria of proportionality among different political parties, which do not necessarily respect each other. See the STS September 9, 1988 (Aranzadi nº 7039) and the STS December 5, 1988 (Aranzadi nº 9317). 26 Art. 36.5 TR and 34 e) RPDT. 27 Art. 36.7 and 8 TR and 34 g) and h) RPDT. 28 The Autonomous Community of Castilla–La Mancha has clearly opted for empowering mancomunidades as the only solution to resolve the technical and economic differences presented by 915 municipalities, of which approximately 70% have fewer than 1000 inhabitants and 55% have ordinary resources below 120.000 Euros. Specifically, at the end of 1993, 87 mancomunidades were counted in Castilla–la Mancha, which included in their objectives the collection, dumping and treatment of solid residues (41), the supply and depuration of water (9), the improvement and conservation of rural pathways (2), and other municipal services including fire fighting, drainage, street lighting, etc. (29). (Data from the Junta

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de comunidades de Castilla–la Mancha.) In 2005 there were 122 mancomunidades in Castilla–la Mancha, as shown in the second section of this paper. 29 If the realisation of local public works involves the expropriation of specific properties, the specific agreement of the associated communities will be necessary. 30 The Fourth Transitory Disposition of the Recompiled Text in the 1st section underlines that "local police will only exist in municipalities with populations higher than 5000 inhabitants except when the Ministry of Territorial Administration authorises its creation in a census of inferior number". 31 Sentence of the Supreme Court of May 27, 1992 (Aranzadi nº 4445). 32 Article 34 d) of the RPDT and Article 36.4º of the TR of the same manuscript. Both precepts referred to the ‘aims’ of the municipal associations. 33 According to the doctrine of the State Council, the aims of the mancomunidades should be limited, preventing them from associating for the realisation of all the works and services of the municipalities concerned (Opinion nº 47.397, March 28, 1985). Also the Opinion nº 47.870, January 16, 1986. 34 Supporting this thesis, Martin Mateo (1987: 77-8) considers that the aim of the mancomunidad "can be multiple in the sense of including activities with their own substantive profiles either inter-connected as might be the supply and maintenance or without these clauses, transport, treatment of waste". 35 List of services of the Mancomunidad of Penedés y Garraf in Article 4 of their statutes. 36 For the financing of the service provided by the residual waste water treatment plant, a Consortium was created between the association of municipalities and the Diputación of Barcelona. This Provincial Diputación provides 28% of the budget of the Consortium for Treatment of Solid Urban Waste from Penedés and Garraf. The creation of a Consortium with the participation of a Mancomunidad together with other entities is not an isolated case. Specifically, in the Autonomous Community of Catalonia we can cite the Consortium of the Parque Serralada de Marina, constituted between the mancomunidad of municipalities of Barcelona, the Diputación de Barcelona and five other municipalities of the area not integrated in the mancomunidad for the coordination in the management of several municipalities affected by the problems of the park. We can also mention the Consortium for the treatment of solid waste, La Plana, constituted between the Mancomunidad La Plana and the Diputación de Barcelona. In both cases the Diputación is integrated in the Consortium with economic contributions even though it was not a receptor of service provided by the Consortium entity. In the CCAA of Andalusia, this phenomena reached its maximum expression with the constitution of the Consorcio Provincial de Agua y Medio Ambiente of Huelva (provincial water supply and environmental Consortium), which integrated five municipalities, six mancomunidades of water and the Provincial Diputación of Huelva. See Lopez Menudo (1995). 37 Data (2002) from the Ministry of Public Administration available at http://www.dgal.map.es/cgibin/webapb/webdriver?MIval=REEL_manc_fines. 38 This last characteristic permits the distinction between Metropolitan Areas and Comarcas, entities created by autonomic law but in rural zones. 39 Article 43.1 LBRL states "the Autonomous Communities after audience with the State administration Town Halls and Provincial Diputations involved can create, modify or eliminate by law Metropolitan Areas, in accordance with that established in the respective statutes". 40 The regulations of the Register of Local Entities passed by Royal Decree 382/1986 February 10 has since been modified by Royal Decree 391/2005 of April 1. 41 To this effect, see Barrero Rodríguez (1993: 220). 42 Law of the Valencia Parliament, December 31, 1986. 43 Martín Mateo (1987: 239) qualified it as a compromise solution. Barrero Rodríguez (1993: 261) offers a similar opinion. 44 The foundation law did not attribute direct competence to the Consell Metropolitá but delegated to the State or autonomic legislation the obligation to regulate the specific sectors of the activity. 45 Law 5/2004 July 13 of the Generalitat de Valencia modified Law 2/2001 to include six more municipalities in the same territorial area of the Entidad Metropolitana de Servicios Hidráulicos. 46 Autonomous law of Catalonia, 7/1987 April 4. 47 The RS (Articles 37 to 40) and the TR (Article 110). 48 The Autonomic norms that introduce novelties are limited to the Municipal and Local Regime of Catalonia, Law 8/1987 of April 15, elaborated by the Regulation of works, activities and services of local Catalan entities (Decree 179/1995 of June 13), Law 7/1993 of July 23 for the Municipal Demarcation of Andalusia, and the Norma Foral 3/1995 of March 30, relative to the entities of the supra-municipal area of Vizcaya.

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49 Paragraph 5 of current Article 6 of the LAP was originally Article 7. The reform of the LAP by Law 4/1999 of January 13 fixed the numerical change. 50 Other examples are the Consorcio Alta Velocidad de Barcelona created in 2003 by the State, the Autonomous Community of Catalonia and the Town Hall of Barcelona for the management of the High Velocity Train; Consorcio Almeria 2005, created in 2003 and integrated by the State, the Autonomous Community of Andalusia, the Town Hall of Almeria and also private non profit entities for the promotion of sport and the creation and maintenance of sports installations in Almeria; the Consorcio Turístico Ruta de los Tres Reyes, created in 2000 by three Town Halls of Aragón (Alcañiz, Morella and Tortosa) with the aim of promoting tourism in that area. 51 Specifically, the Consorcio Cultural Contemporáne “Barcelona Casa Caritat” integrated by the Town Hall and the Provincial Council of Barcelona. It complained it could not benefit from the fiscal deductions that local entities had when publishing announcements in the Official State Bulletin. 52 Aranzadi nº 4692. See Nieto Garrido (2001). 53 Article 47.2 g) LBRL demands the majority vote in favour by the legal number of members of the municipality for the “creation, modification or dissolution of the Mancomunidad or other associative organisations as well as the approval and modification of its Statutes". 54 Articles 39 RS and 110.3 TR also Article 36.1 d) of the Law of Municipal Demarcation of Andalusia. 55 Articles 18, 19, 20 of Law 30/1984 2 August on Medidas para la reforma de la Función Pública (Civil Servants Law). 56 Concerning the legal regime and prerogatives, see Tambou (1999).

CHAPTER 9 JOSEPHINE KELLY

THE MISSING INGREDIENT: INTER-MUNICIPAL COOPERATION AND CENTRAL-LOCAL RELATIONS IN THE UK

1.

Introduction

The thrust of the argument presented in this chapter is that inter-municipal cooperation (IMC) in the United Kingdom reflects local government’s constitutional position and its exposure to the exigencies of Westminster (elected central government) and Whitehall (centre of the professional civil service that services central government). For the most part councils are without general powers of competence and are restricted in what they can do by Parliament. This suggests that the capacity for locally driven IMC is restricted and operates principally within a framework constructed by central government’s policy objectives and legislation and the political expediencies of the governing political party. In practice, however, recent examples of IMC demonstrate that the practices are more complex than this initial analysis suggests. Central government may exert top-down pressures and impose hierarchical directives, but there are important countervailing forces. Constitutional changes in Scotland and Wales have shifted the locus of central– local relations away from Westminster and Whitehall. In England, the seeding of English government regional offices in 1994 has evolved into an important structural arrangement that encourages councils to work together. Within the local government community there is now widespread acknowledgement that to achieve the ambitious targets set by central government, councils are, by necessity, bound to cooperate and work with other agencies. In recent years, the fragmentation of public service delivery has affected the scope of IMC. Elected local government in the UK is now only one piece of a complex jigsaw of agencies that provides services to the public; whether it is with non-elected bodies, such as health authorities, public protection authorities (police and fire), voluntary nonprofit organisations or for-profit bodies, councils are expected to cooperate widely with agencies in their localities. Indeed, for projects such as regeneration and community renewal, councils may act as the coordinating agency but the success of such R. Hulst and A. van Montfort (eds.), Inter-Municipal Cooperation in Europe, 193–210. © 2007 Springer.

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projects is measured by collaboration and partnership working (Davies 2002). To place these developments in context, IMC is an example of how, in spite of the fragmentation of traditional forms of government, councils work with other public service agencies and other councils through the medium of interagency partnerships, collaboration between organisations and a mixed economy of service providers. Such an analysis suggests that, following changes to the system of local government, contemporary forms of IMC are less dependent on vertical arrangements (top-down direction from central government) as they are replaced by horizontal modes (expansion of networks and partnership arrangements). Evidence suggests, however that central government continues to steer local authorities through the agency of inspectorates and regulatory bodies, and through policy initiatives, such as local strategic partnerships and local area agreements (Kelly 2006), thus questioning whether, in the case of UK local government, the shift from hierarchy to network and market solutions is less differentiated and transformation less complete than some literature suggests. Vertical or horizontal pressures may promote IMC, yet similar drivers may deter collaboration between local authorities. An example of negative vertical pressure was central government’s change of the systems of local taxation during the 1980s. The new taxation regime replaced a tax on property with a tax on individual residency. Although the community charge lasted only a few years, it was a highpoint of the then Conservative government policy that encouraged councils to compete with each other on the basis of the level of local taxation. In practice, however, the complexity of local government funding in the UK rendered worthless any meaningful ambition of councils competing with each other, especially as central government granting to local authorities is predicated (however imperfectly) on at least notional equalisation between those areas with lower tax yields and the more prosperous locations. Horizontal pressures comprise factors such as planning decisions. Over the last quarter century, councils have competed on the granting of permission to out-of-town retail and leisure complexes, now recognised as detrimental to neighbouring authorities because economic forces prevail and local, independent shops are unable to compete with multiple companies. These examples illustrate tensions at the core of the UK polity of whether IMC is feasible when competition between local authorities heightened by local differences reduces opportunities for collaboration. An alternative perspective on IMC is to explore whether specific purposes or functions promote or restrict it. Whether in the principle areas of local government responsibilities relating to social welfare, development and maintenance of the local infrastructure or environmental matters, there are examples of IMC. But opportunities have diminished considerably as councils lost responsibility for services provision as a result of privatisation and transfer of powers to new government agencies or to central government. Over the last twenty years councils have lost their role in the provision of further- or higher-education, public transport and water/sewage. Councils have commissioning power but only a limited presence in providing housing needs, social care and waste management. In other words, as a result of central government policy, there are, in practice, currently far fewer opportunities for councils to cooperate.

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Since 1997, the New Labour government has promoted IMC through vertical drivers and the development; the operation of these policy initiatives is discussed following the framework of the editors. Current examples of IMC are notable for being driven by higher tiers of government, working with subordinate authorities in principal-agent relations. Collaboration between local authorities and intra- interand cross-sectoral partnerships are initiated by central government. In other words, IMC is shaped by hierarchical drivers from higher levels of government but, in practice, is locally varied and determined less by formula than by necessity and function. 2. The UK System of Local Government The UK system of local government is exceptional. Unlike many other systems of local government in Europe, the UK councils are restricted in their powers and mostly undertake the delivery of services in their area on behalf of central government departments. Thus, local authorities in the UK do not enjoy their European counterparts’ powers of general competence; local government in Britain can only carry out activities within the parameters of the current legislation. This was modified by the Local Government Act 2000 in England and Wales. In Scotland similar legislation was enacted in 2003 by the Scottish parliament. In England and Wales the legislation provided councils powers to promote the economic, social and environmental well-being of their locality. In practice, these powers are rather limited. They do not include permission to raise additional revenue and as yet there are few examples of councils testing the extensity of the powers. More generally, Acts of Parliament as primary legislation usually delegates powers to the appropriate government ministers, who issue the details of legislation in Statutory Instruments, which effectively constrain councils by prescribing the implementation of primary legislation (Wilson & Game 2002). Historically, the most significant constraint on councils is the doctrine of ultra vires: a Latin legal term that translates to “within powers”. Those councils that are judged to be acting outside ultra vires would be deemed to be acting beyond their powers and, therefore, their actions considered unlawful. As councils found, ultra vires defies specific definition and is open to interpretation. Indeed, controversial policies adopted by several councils were tested in law (Loughlin 1996). Councils are further restricted by their responsibilities to their funders to spend “wisely” money that is held in trust on their behalf. Judging whether councils have met their fiduciary duty is complicated as local authorities have multiple accountabilities: central government, local taxpayers and electors. Central government and local authorities have strongly disagreed in the past on what constitutes “value for money”. Judging whether a council has spent money wisely is open to interpretation, especially when the judgement is predicated on ideological differences on the role of government and what services and level of services should be provided by councils (Loughlin). As a consequence of these tensions the government has in the first instance required auditors to make judgements. Similar to the doctrine of ultra vires, the principle of fiduciary duty has been defined through legal judgements and common law. Taken together the doctrines of the fiduci-

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ary duty of ultra vires have effectively constructed a constraining environment within which councils operate. During the 1980s and 1990s, these doctrines were tested as central government and a significant number of local authorities disagreed on the powers of local authorities, specifically on local tax-raising powers and spending plans (Langsley et al. 1989). The reason local authorities are restricted in their powers is partly because councils were first established in the UK. Although there was an embryonic system of local administration prior to the early nineteenth century, it was unable to deal with the consequences of rapid urbanisation and industrialisation. During the nineteenth century the system of local government evolved initially to deal with the new cities and towns, such as Birmingham and Manchester, then later the suburban and rural areas. Only at the dawn of the twentieth century was a system of local government established for London (Hampton 1991). The establishment of local government provided opportunities for those people who were newly enfranchised to exercise their right to vote. In the twentieth century, however, the purpose of legislation changed. Although the franchise for local government elections continued to be restricted until 1974, during the twentieth century some councils responded to majority demands to use local taxation to alleviate social problems, such as unemployment and education. Such actions were short-lived. Councils were judged to be ultra vires and not meeting their fiduciary duty; in the short term councillors were penalised, and government has incrementally removed those controversial responsibilities from councils. Less controversially but also incrementally, councils lost responsibilities as some functions, like major road construction, came to be regarded as having national importance and were brought into the orbit of central government, although councils retained responsibilities under agency agreements for maintenance of some major highways and for minor roads in their localities. Similarly, responsibilities for further and higher education were transferred from local authorities to quasi independence under the umbrella of non-department public bodies. The most significant change to the responsibilities of local authorities came after 1945. Local government became an important structure in the delivery of the newly created welfare state, acting as the main vehicle to provide education, social housing, environmental improvements and later, social care. This increased political controversy for several reasons: First, local taxpayers were often unwilling to pay for improvements that benefited most those who often contributed very little, a consequence of partial progressive nature of local taxation (Bulpitt 1969). The political ramifications of the financial mismatch were heightened as most councils after 1945 lost their municipal enterprises and the financial resources to subsidise improvements in their areas. Second, since the nineteenth century, central government grants had been used permissively to encourage councils to implement national policy. After 1945, government gave councils less latitude. Indeed, councils became caught in a cycle of financial dependency. Encouraged to provide a greater range of services and improvements for their locality, and unable to fund service expansion solely from the local tax yield, local authorities became increasing dependent on central government grants. Yet attempts by central government to update the local tax basis has consistently been cause for political controversy and generally unpopular. Governments are highly aware of the popular perception that any revaluation of the tax basis would

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lead to across the board increases, which has resulted in governments postponing and delaying revaluations, most recently in 2005. Third, although governments have attempted to take steps to help those councils with low tax yields, equalisation remains complex and opaque, significantly reducing local accountability to determine local levels of expenditure and taxation. In summary, then, local government in the UK was established in a piecemeal fashion; functions and purposes were added or removed according to the prevailing needs of the polity and according to political expediency. The financial basis of local government remains highly dependent on central government. These tensions may be illustrated by the problems associated with the reorganisation of local government structures. In the case of the 1972-74 reorganisation, earlier recommendations were overturned because of the controversy between the major political parties, which sought to gain maximum advantage from their domination of local councils, and the total number of councillors was believed to affect the national standing of the political parties (Gyford 1984, 1985, Young and Garside 1982). The cost of reorganisation was considerable and the promised efficiencies through greater economies of scale failed to materialize. Moreover, the abolition of historical place names held by councils was unpopular with the public. Not surprisingly, since the 1974 reorganisation of local government, central government has found these good reasons to meddle with its structure and organisation. These themes – piecemeal development, susceptibility to the political expediencies of the day and financial restriction – continue to affect the structures of local government. Current structures are the remnants of the 1974 system, which introduced a two-tier system of councils. Since the mid-1980s government, by a gradual process of abolition and merger, has produced a single tier of local government in Scotland and Wales and for most urban areas in England. At the time of this writing, the government was considering replacing the remaining two tier authorities (mostly in the suburban and rural areas of England) with unitary councils. The governance arrangements for London are the exception. Post-1974, it enjoyed a two-tier system, London Boroughs and the Greater London Council (GLC), which held strategic responsibilities and cross-city services. As a result of clashes with the then Conservative government, the (Labour-held) GLC was abolished and its responsibilities were passed to the London Boroughs (mostly education and housing) and to a mish-mash of unelected and appointed bodies (for example fire services). In 1999, after the election of New Labour, London regained a strategic body, headed up by a directly elected mayor and a Greater London Assembly. Since being elected in 1997, the New Labour administration has continued to regulate local authorities. Unlike previous administrations, however, the New Labour government has focused on aiming to improve the quality of services provided by local authorities, modernize councils’ decision-making structures and direct local government to work closely with the plethora of non-governmental bodies that provide services to the public (Brooks 2000, Kelly 2004). Local government structure Municipal authorities in the UK have three primary functions: 1.

Service provision: Councils are responsible for service provision, directly or in

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2. 3.

partnership with private sector or not-for-profit organisations. An example is waste management. Representative role: Local authorities are directly elected; members are appointed to represent their councils, or elect members for a number of public bodies, such as police authorities. Consultative role: councils are routinely consulted by government and public bodies regarding decisions that may affect their locality.

Local authorities in the UK provide services to the public in three principle areas: 1.

2. 3.

Infrastructure: including roads, bridges, pavements, street lighting. More re cent council responsibilities include economic development. Since 2000 councils in England and Wales have powers to promote the economic wellbeing of their locality (2003 in Scotland). Limited support for public transport Environmental and amenities: waste collection and disposal, parks and open spaces. Social welfare: including education, social care (for the vulnerable), and social housing.

Over the last twenty-five years, most of these functions have been reduced as local authorities have moved from direct service provision to a commissioning role. As discussed previously, in the mid 1970s a two-tier system of local government was established in England, Wales and Scotland, which gave higher tier local authorities responsibility for strategic provision of infrastructural, environmental and social welfare services. In the metropolitan areas lower tier authorities were responsible for education and social services. In London, this was restricted to the latter only, as education was provided on a citywide basis. In the suburban and rural areas the county authorities took responsibility for education and social care, as the lower tier councils were too small and lacked sufficient capacity to run such services. The 1970s structure assumed that higher and lower tier councils would work together, higher tier authorities providing strategic leadership for the larger area, while lower tier councils were more focused on service delivery. For political and structural reasons, ten years after the reorganisation, the metropolitan county councils and the GLC were abolished, their functions passed to a plethora of non-elected and indirectly elected bodies and the new unitary authorities. In Scotland and Wales the two-tier system was abolished in 1996. Although the two-tier system has survived in England in the suburban and rural areas, most urban and some rural areas became single-purpose unitary authorities during the 1990s. Local government in Northern Ireland continues to be shaped by the community divide. Election gerrymandering, including area boundaries, gave inbuilt majorities to the Protestant population at the expense of the Catholic community. In 1973 the government created 26 single-tier district councils with greatly reduced powers. At the same time the majority of the responsibilities were taken over by government quangos, known as area boards, and this remains the case (Wilson & Game 2002).

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Structure of UK local government 2006

Unitary Authorities

Two-tier Authorities

England (answerable to Parliament & the Office of the Deputy Prime Minister)

Wales (answerable to the Welsh Assembly)

Scotland (answerable to Scottish Parliament)

N.I. (answerable to Secretary of State for Northern Ireland )

- 33 London Boroughs (incl. Corporation of London) - 36 Metropolitan Districts - 47 English Unitary Authorities - 34 County Councils - 238 District Councils

22 Unitary Authorities

32 Unitary Authorities

26 District Councils

NA

NA

NA

3. Opportunities for and the Practice of IMC Although considerable structural and political restraints restrict possibilities for IMC between UK local authorities, since 1997 central government has instigated initiatives by using vertical drivers to encourage councils to adopt collaboration for common purpose with other agencies that provide public services in their localities. By so bringing service providers together, central government is signalling that it acknowledges it is dependent on partnership relationships with councils and other providers of services to the public to achieve national strategic objectives. Probably the most significant development towards achieving optimum strategic leadership and coordination necessary for IMC was the creation of a regional tier of government. Created by the then Conservative government in 1994, it was established to give central government regional presence. The Government Offices (GOs) have grown since 1994 and presently represent ten Whitehall Departments. They are the regional presence of government departments in England, which include those responsible for local government, the environment, and the Departments of Education and Skills, Trade and Industry, Work and Pensions, Transport, Health and Culture. (In the case of Scotland and Wales the regional authorities were replaced by the creation of the Scottish Executive and Parliament and the Welsh Assembly and Welsh Assembly Government; see below.) These arrangements are the primary means by which a wide range of government policies are now coordinated; they ensure that policies are delivered to the localities in England by councils and other service providers, although they have no responsibility for service delivery themselves (Judge 2005). The stated aim of the GOs is to bring

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together the activities and interests of government departments responsible for providing services to the public to ensure that policy delivery is coordinated to best effect. To place this into context, in 2004-2005, GOs were responsible for over £9 billion of government expenditure. The GOs are involved in policy areas that include regenerating communities, fighting crime, tackling housing needs, improving public health, raising standards in education and skills, undertaking countryside issues, and reducing unemployment. Most of the government departments represented in the GOs provide strategic leadership with their work with local authorities to ensure that the delivery of services meets government objectives. In addition, GOs have a particular responsibility to work with councils to improve service delivery and provide value for money while promoting better policy integration across the country. The GOs work with local authorities in their area in several ways: • •

•

By advising councils on government policy and, in turn, using their local knowledge to influence new policies affecting local government; By assessing their capital strategies and asset management plans as part of the “Single Capital Pot” programme (where the government provides the bulk of capital support to local authorities, replacing previous separate allocations for transport, housing, education, health, etc.), and providing feedback on their performance; By working closely with the poorest-performing authorities, as identified in the Comprehensive Performance Assessment (part of central government’s regulatory framework used to monitor councils, see Kelly 2006) and to help address identified weaknesses and prepare a recovery plan.

GOs are not the only regional actors; in 1998, the New Labour government legislated for devolved government in Scotland and Wales. In England, however, devolvement was restricted to the creation of eight regional development agencies (RDAs) in England by the Regional Development Agencies Act 1998, and was formally launched in eight English regions in April 1999. In addition, the government created the Greater London Authority (GLA) in July 2000, which provided a regional layer of government for the capital. The 1998 Act required the RDAs, in conjunction with the Regional Chambers (made up of indirect representatives), to develop a strategic vision for each of their regions, and issued statutory and non-statutory guidance to the RDAs on the formulation of these strategies. RDAs were encouraged to formulate priorities to improve regional economic performance and show how it could be achieved. With regard to working with local authorities, in addition to helping councils meet their obligations to the economic well being of their locality, RDAs also provide advice and guidance on planning matters and regeneration strategies, including developing strategic communities. The RDAs and the GOs remain different organisations. The RDAs were originally envisaged as a vehicle to boost regional identity and act as a conduit for regional government. However the attempt by central government to foster popular demand for elected regional government (with further reduction in the number of local authorities) was rejected in 2004. The GOs, on the other hand, remain the voice of the ambitions of central government in the regions. When the RDAs were established, the relationship between the two organisational structures was difficult as there was overlap and some duplication of

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the policy areas in which they have an interest, for example, regional economic development and education and skills. However, these initial teething problems have subsided and the government assures observers that an effective relationship has developed between these regional actors. Yet, in the medium term, the future of the RDAs remains precarious; being only weakly accountable to the local authorities in their area and duplicating some effort of the GOs suggests that government would seek rationalisation for them. However, the RDAs remain an important symbol of New Labour’s commitment to devolved government, although its vision was rejected in 2004. New Labour is currently investigating whether the “core cities” model could provide the necessary drive for greater regional collaboration between councils and other actors to promote local economies (Marvin et al. 2006). Returning to the GOs operational or implementational activities, these bodies work with local authorities to promote partnership, specifically in the delivery of Local Public Service Agreements (LPSAs), Local Strategic Partnerships (LSPs) and Local Area Agreements (LAAs). 3.1. Local strategic partnerships Local strategic partnerships (LSPs) were established following the Local Government Act 2000. They are single, non-statutory bodies that bring together local public, private, community and voluntary organisations with mostly unitary and higher tier authorities. Their primary purpose is prepare and publish a Community Strategy as a result of consultation with the community and partners, which comprise other statutory bodies, such as public protection and health authorities, in conjunction with non-profit organisations, including voluntary- and community-based groups. LSPs are expected to be active in providing strategic leadership in the policy areas of crime, unemployment, education, health and housing, offering a coordination that was previously lacking. Initially LSPs were voluntary in most local authority areas and mandatory only in the 88 Neighbour Renewal Areas (NRAs). In practice, however, all higher tier authorities and unitary authorities championed the establishment of LSPs in their localities, and now all areas are covered by such strategic partnership arrangements. Although local partners can decide the full range of work undertaken, the government expects the following tasks to be included: • • •

Bringing together local plans, partnerships and initiatives to provide a forum for public service providers (for example, health and police) to work effectively together to meet local needs and priorities; Working with local authorities to help devise and meet Local Public Service Agreement (LPSA) targets and potentially taking a key role in brokering and delivering targets/outcomes of the Local Area Agreement (LAA) process; and Where applicable, developing and delivering a local neighbourhood renewal strategy to secure more jobs, better education, improve health, reduce crime and provide housing.

In summary, then, the purpose of LSPs follows New Labour’s analysis of the importance of government bodies working in partnership with other actors to work strategically together to link partners’ activities across a range of issues, to enable partners to meet their

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own targets, and to tackle cross-cutting issues more effectively. The government’s ambition for LSPs is that they strengthen connections with and among public sector agencies, local government, the voluntary and community sectors, businesses, and local residents. In doing so these strategic vehicles ensure that public services function better, are delivered in way that meet the needs of local people, and sustain economic, social and physical regeneration in both deprived and prosperous areas. Within the framework guidance for LSPs, central government’s apparently inconsistent view of the effectiveness of local authorities is a recurring theme. On one hand, the LSP guidance clearly states that any organisation can lead an LSP. In many cases, local authorities have taken the lead in establishing LSPs; however, once established, LSPs can decide who is most appropriate to chair the partnership. Many partnerships have adopted a policy of rotating the chair among sectors to reflect and retain buy-in from partners. In practice, however, few have the scope to match the capacity of local authorities. Moreover, local councillors and directly elected mayors play a pivotal role. Ward councillors, for example, have extensive knowledge of the problems of their localities and provide a link between local people and service providers and planners. Furthermore elected members have an important role as members of the executive and/or scrutiny committees within their local authority to ensure that services provided by the council and its partners are designed and delivered in a way that meets the needs of the area. With regard to GOs, their roles typically include: • • • • •

Acting as facilitators to support the development of LSPs Promoting networking among partners and other LSPs Acting as mediators to resolve problems Providing a direct channel of communication between LSPs and central government Assessing (where applicable) whether LSPs in Neighbourhood Renewal Fund (NRF) areas are effective and involve genuine community participation.

The government has an extensive programme of research to evaluate LSPs; however, most of the outcomes have focused on their operational aspects, often through action research sets designed to assist the practitioners involved with ensuring the effective operation of the partnerships. Medium term research – for example, on the effectiveness of LSP work with RDAs – follows this approach. 3.2. Local Public Service Agreements Public Service Agreements are used across government as a mechanism to drive up performance and quality of services through contracts between service delivery bodies and the Treasury. Local Public Service Agreements (LPSAs) were first set up in 2000 and were extended to all upper tier authorities in 2001. The purpose of the agreements is to support local authorities in performance and to help achieve specific strategic aims over the life of the agreement. The foundation for LPSAs flows from the priorities set out in a local authority’s community strategy in conjunction with LSPs. The purpose of LPSAs is that councils commit to a dozen or so specific targets that require performance beyond what could have been expected in the absence of such a contract in return for a local authority fulfilling its side of the bargain; the government rewards successes. Local

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authorities are notionally free to choose the policy areas on which to set targets by matching local priorities identified by the LSP. In practice, however, guidance from the government indicates that the targets mostly reflect national aims; although local ambitions are included, they have less importance. Indeed, there are expectations from the GOs that councils should choose a majority of the targets from the specific issues incorporated in national PSAs that relate to local government services. The government expects the targets to be “stretching” and results must show a specific and measurable improvement compared with the performance that could have been expected without an LPSA. In return, government offers a maximum reward grant of 2½% of a year’s net budget for achieving the stretching targets in full. A scaled-down grant is given for achieving a large portion of the improvement. The authority decides the purposes for which it will use the reward grant. Second generation LPSAs were implemented and completed between March 2004 and March 2006. Both central and local government communities concluded that the first round of LPSAs was broadly successful but noted a number of limitations:

1. Central government did not put sufficient effort into freeing up the capacity of councils to take action in their chosen target areas. 2. From the menu of targets, about two-thirds were centrally-determined goals. This was viewed by some local authorities as restrictive with respect to the councils’ own needs. 3. Councils were believed to be lacking in ambition as they asked for freedoms that they already had but were not used to full capacity. To some critics, this was viewed as the lack of ambition held by many local authorities to work for their locality. However, as discussed previously, the capacity of local authorities is constrained by the dual parameters of ultra vires and fiduciary duty, which are usually interpreted by the auditors answerable to central government via the Audit Commission (Kelly 2003). This further suggests that local authorities seem to be in a double bind: The success of LPSAs rests firmly on the capacity of councils to achieve the targets, yet success is dependent on securing the agreement of central government to release resources to local authorities while the prevailing ethos in central government is that these bodies are not “good enough” to be trusted to run local services. The second generation LPSAs were introduced with modifications; these include, for example, a more local focus and will depend on the authority’s priorities for improvement locally. Those priorities will be derived from evidence, such as the community strategy, the improvement plan for the council following from the Comprehensive Performance Assessment, the neighbourhood renewal strategy, and performance regarding other core targets. What matters most is that central and local government and all relevant partners agree that the evidence points to the identified areas as priorities for local improvement through the LPSA, and that they can all work together to achieve the agreed outcomes. 3.3. Local Area Agreements Local Area Agreements (LAAs) were first launched in March 2005 as a pilot scheme. The following year the government set up a second phrase that extended the programme

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to all higher tier authorities and unitary councils, which is to start in 2007. The primary purpose of an LAA is to simplify funding arrangements from central government to councils. Furthermore, the programme is designed to promote closer cooperation between providers of public services, with the aim that these arrangements will allow increased flexibility for local innovations in service delivery to fit local circumstances. Central government is claiming that LAAs are a form of devolved decision making, which moves away from central steering and reduces the complex bureaucracy associated with administering several funding streams. LAAs are structured around four policy fields known as blocks: children and young people, safer and stronger communities, healthier communities and older people, and economic development and enterprise. LAAs are an important dimension of the government's ten-year strategy for local government, which seeks to foster a more mature relationship between central and local government. Central to this new relationship are the GOs, which have a leading role in negotiating with LAAs and will provide local partners with a single point of contact in central government. Similar to LSPs and LPSAs, higher tier authorities (county councils) will work in partnership with lower tier (district) councils. Within district councils is some disquiet because they will be expected to cooperate with the county councils to meet the objectives of the LAAs, yet, in practice, they are expected to tailor their own priorities to help the higher tier council meet its objectives. In a further twist, the government is currently reviewing the structure of the remaining two-tier councils with a view toward streamlining the system by merger and restructure to make a unitary system. Within the local government community are some opinions that the LAAs are also vehicles to facilitate the proposed restructuring and mergers. LSPs, LPSAs and LAAs are operational measures that link wider policy objectives to New Labour in several ways:

1. New Labour has a complex relationship with local government. In order to make his party electable, Tony Blair strenuously rejected much of the traditional ideology and practice of the Labour Party. Among Blair’s modernisers, many believed that Labour’s record in local government contributed to the Party’s inability to win a national election. Hence, although New Labour has striven to forge a partner relationship with local authorities, it has very much been on central terms to further the policy objectives of New Labour. Consequently, New Labour‘s partnership with local councils has been predicated on an overhaul of the councils’ policy-making structures, coupled with a tough performance improvement regime and enforced by regulatory oversight (Brooks 2000, Kelly 2004). 2. New Labour’s election-winning strategy included a commitment to deal with the multiple causes of problems, such as social exclusion and social deprivation, sometimes described as “wicked issues” because of their complexity and defiance of easy or traditional solutions (Stewart 1997). Local authorities remain the most obvious vehicles to address problems in urban decline: poor social housing, low standards of educational achievement and higher morbidity and mortality rates. However, within Whitehall several central government departments remain sceptical of local government’s capacity to deal with multiple problems, including

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social exclusion. Indeed, according to the prevailing view in some departments, local authorities had contributed to the problems in their localities, failing to halt a decline in standards by being resistant to change and reluctant to address the power of producers. Despite internal misgivings on the capacity of local authorities to deliver results on alleviating multi-causal social problems, New Labour decided to enter into agreements with local authorities to secure core targets and achieve positive outcomes. Effectively, such agreements are manifestations of Whitehall’s scepticism towards local government capacity to deliver without central direction and oversight. These developments also illustrate New Labour’s commitment to managerialism in the delivery of public services. In others words, local authorities are expected to deliver centrally-determined outcomes, predicated on a performance management regime that continues to be government’s major driver to improve services.

4. Scotland and Wales Devolution to the home nations of Scotland and Wales in 1998 acted as a vertical driver to facilitate IMC. Driven by the dual ambitions of increasing the effectiveness of government bodies and other public service-providing agencies by promoting partnerships, and enhancing the efficiency and economy of public services, the Scottish Executive and Parliament, the Welsh Assembly Government and the Welsh Assembly have emulated developments in England, although with the absence of an intermediate regional tier of government. 4.1. Scotland In Scotland partnership working has been predicated on the notion of a “community planning … process ... whereby public services in the area of the local authority are planned and provided after consultation and (on-going) co-operation … among all public bodies ... and with community bodies" (Local Government in Scotland Act 2003). This statement is translated into programmes to ensure that people and communities are engaged in decision making on public services that affect them, linked to a commitment from organisations to work together to provide better public services. In other words, Community Planning (CP) provides a framework to coordinate policy initiatives while improving the connections between national priorities and those at regional, local and neighbourhood levels. Core partners (Enterprise Networks, NHS, Police, Fire and SPT– Regional Transport Partnerships from April 2006) are expected to participate in CP. Although the Act is not prescriptive in how CP should be carried out, recognition of what is appropriate will depend on local circumstances. Community Planning Partnerships will operate in all 32 local authority areas with a range of partners. In addition to those with a duty to participate, agencies and others such as Jobcentre Plus, SNH, further and higher education institutions, business representatives, Social Inclusion Partnerships and the voluntary sector are involved in a number of partnerships.

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4.2. Wales The creation of the National Assembly for Wales and the Welsh Assembly Government coincided with significant change in local government in Wales. The Welsh Assembly Government has focused on ensuring that the new unitary authorities operate more effectively and efficiently and are more responsive to the needs of their local populations. The mechanisms for promoting change have included community strategies and the fostering of greater partnership working between local authorities and other partnerships. The Welsh Assembly Government is also installing policy agreements with each local authority. These set specific targets for each authority concerning developments and improvement in local government. This includes a requirement in the Local Government Act 2000 that local authorities prepare a community strategy that provides a vision of the aspirations local authorities and their partner organisations have for their areas to develop and achieve over the next 15-20 years. Councils are expected to widely consult with local communities, organisations and the public. Local authorities and other public agencies would have regard to the community strategies in providing services and undertaking investment in county areas. In turn, the strategic aims would inform the Wales Spatial Plan and require neighbouring local authorities and their partner organisations to contribute to setting the vision for the wider sub-region, which will establish the context for the community strategies. 5. Commercial Drivers for IMC There is legislation that allows councils to work with other public sector bodies for the provision of goods, materials, and administrative, professional and technical services, for the use of vehicles, plant and apparatus, and for the carryin out of maintenance. However, the terms of the 1970 Act were restrictive. In 1999 the government consulted with local authorities in England and Wales to provide councils with new powers to provide a full range of goods and services to those working in partnership with them. In 2001 the government proposed that councils should have wide powers to trade where it helps achieve best value in the delivery of public services. New powers introduced by the Local Government Act 2003 allow local authorities to trade with private bodies and persons for profit. In the case of local authorities in England, the powers have been introduced as part of a new package of freedoms and flexibilities bestowed on wellperforming councils. The government believes that trading will help create a dynamic and entrepreneurial public sector that will increase diversity and choice in the delivery of public services. Through trading, local authorities are encouraged to extend and improve the range of services they offer and new players are placed in the market. Moreover, the government anticipates that trading will increase the scope for partnership working and provide business opportunities for the private sector. In Wales, the situation is similar to England; local authorities have until recently enjoyed only limited powers to engage in quasi-commercial activities. Aside from some specific and for the most part little-used powers, the only option has been to employ the powers in the Local Authorities (Goods and Services) Act 1970. This legislation allows

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councils to trade with each other and with other designated public and quasi-public bodies, but not with the private sector or with individuals. Similarly, the 2003 Act provides councils with trading powers modeled after those in England. In Scotland the Local Government (Scotland) Act 2003 bestowed on Scottish Councils powers to trade, subject to certain conditions, but not all of them mirror those in Wales and England. For instance, Scottish local authorities can engage in trading activities directly rather than through a company, but may be subject to limits on the amount of trading income they can retain. In Northern Ireland, there is no general legal basis on which local authorities may engage in trading activity. 5.1. Procurement A significant driver in creating IMC has been the insistence that councils rationalise their procurement strategies. The strategy document concludes: ‘The strategic objective of partnering is the delivery of better services to citizens through the creation of sustainable partnerships between councils and suppliers in the public, private, social enterprise and voluntary sectors for the delivery of services and the carrying out of major projects, including construction. The strategic objective of collaboration is to obtain better value by bringing councils and other public bodies together at local, regional and national levels to combine their buying power and create shared services’ (ODPM 2003). Echoing other policy themes, the national Local Government procurement strategy is driving councils into partnerships for the procurement of a wide range of services. Smaller local authorities without dedicated procurement resources of their own are expected to collaborate with others, mediated through the regional centres of excellence that create shared services for procurement and project management. More generally local authorities are expected to identify opportunities for collaboration with neighbouring councils for shared commissioning and/or delivery of services. In defence of its national strategy, the government concludes that the creation of sustainable, collaborative relationships with suppliers in the public, private, social enterprise and voluntary sectors to deliver services, carry out major projects or acquire supplies and equipment promise benefits that include: improvements in the design of solutions, enhanced integration of services for customers, economies of scale and scope, and community benefits (including jobs and local economic effects). Indeed, it can help foster social cohesion and social capital. The government expects the LSP to act as a forum to promote collaboration at the local level and be a means through which procurement can help deliver the community plan. The government expects councils to collaborate in their procurement strategies, however, it is not prescriptive in what form the cooperation should take. The partnering models that councils are considering include: public sector consortium, non-profitdistributing organisation, voluntary and community sector provision, and public finance initiative contracts. In addition, well-performing councils are invited to use their new trading powers (see above). The government argues these companies can be a means by which strongly-performing councils can jointly develop solutions for councils that are

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performing less well. Service delivery models based on the new powers can also be a means of accessing wider markets. 5.2. Efficiency savings Central to the government’s project to improve public services, including those provided by local authorities, is the achievement of greater efficiency. Known as the Gershon efficiencies (after the Chair of the inquiry that looked into improving greater efficiency in public services), central government has singled out local authorities as holding a key responsibility in this agenda and councils have embarked on programmes of securing efficiencies through investment in technology and rationalisation of back office and procurement functions in order to release resources to the front line. Some of the figures of projected savings seem extraordinary; for example, the ODPM (the government department responsible for local government) reported that the use of e-procurement alone by all local authorities would secure a savings of £1.1 billion. This is only achievable by the collaboration of councils through aggregation of demand organised by the Regional Centers of Excellence and moving towards increased rationalisations of back office and transactional services. In practice, this has been translated into councils collaborating to set up multi-authority call centers and joint partnerships with private companies. Indeed, it is only by sharing services, such as the management of revenue collection and benefits payments, transactional services and IT, that senior local government finance staff believe that the efficiency savings are realisable. 6. Conclusions Inter-municipal cooperation in the UK is different.1 Cooperative arrangements with respect to service delivery are not in the first place driven by economies of scale and do not primarily constitute cooperation between the basic entities of local government, as is the case in all other countries included in this volume. Local strategic partnerships, service agreements and area agreements are above all institutional forms of cooperation between a single local government authority2 on one hand and a range of semiautonomous or central government agencies and private institutions on the other. Their purpose is not so much to join forces with respect to single public services, but to coordinate and integrate the delivery of different public services, attune services to specific local needs and secure the necessary financial and other resources. Moreover, cooperative arrangements are instrumental to the realisation of central government policies, although more recently local government seems to have been given more leeway. Also different from practices in the other seven countries, cooperation primarily occurs through agreements. There are no joint standing organisations or authorities engaged in public service delivery, although coordination does take place through established boards consisting of representatives of the partners involved. Only recently has central government put cooperation between local government councils on the agenda, in order to rationalise the procurement of services. This could result in forms of cooperation comparable to what is found in other countries.

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The idiosyncrasies of inter-municipal cooperation with regard to service delivery in the UK to a large extent follow from characteristics of the actual administrative system. Although the average scale of local government is by far the largest in Europe, its historic position vis-à-vis central government is weak and its operating space limited. Moreover, after 1945, local government became caught in financial dependency and, in the 1980s and 1990s, years of Conservative government resulted in a further hollowing out of the local domain and diminishing policy-making capacity. Therefore, it is understandable that local government, under pressure or voluntarily, engages in cooperative arrangements with the public agencies that hold vital resources rather than their neighbours, even if this means that central government increases its influence on local priorities. Only substantial decentralisation would create conditions for a shift from vertical cooperative arrangements to cooperation between local councils. But for substantial decentralisation to occur, a vital condition seems to be missing: confidence in the quality of local government. Inter-municipal cooperation with regard to the planning and coordination of local government policies is relatively underdeveloped. Devolved government in Scotland and Wales has absorbed planning functions. In England, policy networks have developed consisting of the Government Offices, Regional Development Agencies and Regional Chambers or Assemblies that consist of representatives from local government and private stakeholders. The English regions have been invited to establish elected regional governments, but have not responded accordingly. All in all, it seems that local government does not experience a sense of urgency to engage in provisions for regional planning on an intermediate administrative level. Two circumstances can explain this. The first is that Conservative governments for many years have fed competition between local government rather than cooperation. The second is that central government still holds the reins in many decisions relevant to local policy making; for regional planning to be effective, coordination between the different branches and agencies of central government is more important than coordination between local governments. In sum, despite the absence of an intermediate level of government, the drive forthe coordination of local government policies is weak. Again, substantial decentralisation could change the picture. References Branson, N. (1979). Poplarism 1919-1925. Lawrence and Wishart. Brooks, J. T. (2000). Labour's modernization of local government. Public Administration, 78 (3): 593-. Bulpitt, J. (1967). Party politics in English local government. Longman. Davies, J.S. (2002). The governance of urban regeneration: A critique of the “Governing without government” thesis. Public Administration, 80 (2): 301-322. Erridge, A. & Greer, J. (2002). Partnerships and public procurement: Building social capital through supply relations. Public Administration 80 (3): 503 -522. Gyford, J. (1985). The politics of local socialism, 2nd edition.Croom Helm. Gyford, J. (1984). Local politics in Britain, 2nd edition. Longman. Hampton, W. (1991). Local government and urban politics, 2nd edition. Longman. Judge, D. (2005). Political institutions in the United Kingdom. Oxford University Press. Kelly, J.T. (2003). The audit commission: Guiding, steering and regulating local government. Public Administration, 81(3): 459-477. Kelly, J.T. (2006). Central regulation of English local authorities: An example of meta-governance? Public Administration, 84/3 p 603-622.

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Langley, S., Goss, S. & Walmer, C. (1989). Councils in conflict: The rise and fall of the municipal left. MacMillian. Loughlin, M. (1996). Legality and locality: The role of law in central-local relations. Clarendon Press. Marvin, S. Harding, A. & Robson, B. M. (2006). A Framework for city-regions. ODPM. Office of the Deputy Prime Minister. (2003). National procurement strategy for local government. ODPM. Stewart, J. (1997). Handling the wicked issues: A challenge for government. Birmingham: INLOGOV. Wilson, D. & Game, C. (2002). Local government in the United Kingdom, 3rd edition. Palgrave. Young & Garside. (1982). Metropolitan London politics and urban change, 1837-1981. Edward Arnold.

Notes 1

An analogy to the 1960 slogan of the Spanish Ministry of Tourism, “Spain is different”, which, incidentally, Spaniards themselves frequently used as an excuse for poor services rendered to tourists. 2 Or in the case of two-tier local government, one upper level local authority and a number of lower level authorities.

CHAPTER 10 RUDIE HULST & ANDRÉ VAN MONTFORT

COMPARATIVE ANALYSIS AND CONCLUSIONS

1.

Introduction

Local government in Europe has been facing serious challenges for many decades. Smaller communities are finding it increasingly difficult to meet the demands and standards of local government in relation to the production of public services that require a large or increasing scale of production. Furthermore, all local communities are confronted with the impact of the increasing scale and complexity of social processes, which result in an increasing level of externalities on local policies. And last, European integration and market pressures carry new opportunities – and threats – for local government. One of the strategies to cope with these issues is inter-municipal cooperation. Joint provision of public services is a way to overcome production-related obstacles and simultaneously meet the rising expectations of citizens. Economies of scale (resulting from a higher production) and economies of scope (a consequence of a more varied production) can be realised. Joint planning and joint policy coordination make it possible to incorporate mutual interdependencies among neighbouring municipalities and thus enhance the quality and efficacy of local policies. It is a way to increase the capacity for solving policy problems that escape the boundaries of a single municipality (Herweijer 1998: 150, Hulst 2000: 2-4, Airaksinen & Haveri 2003: 9, Hepburn, LeSage, & McMillan 2004: 14-16). The fact that inter-municipal cooperation is a widespread phenomenon throughout Europe notwithstanding, it has not been subject to systematic comparative research. There is no overview of the variation in density of intermunicipal cooperation in different countries or policy sectors, or of the institutional arrangements in use. Research into the way cooperative arrangements operate and perform and in the factors that determine presence and performance is relatively rare and fragmented and has not been subject to comparative analysis. The main purpose of this volume is to provide systematic insight into the practice of inter-municipal cooperation in a series of European countries. R. Hulst and A. van Montfort (eds.), Inter-Municipal Cooperation in Europe, 211–238. © 2007 Springer.

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Students of public administration from eight countries in northern, southern and western Europe have presented data on the diverse manifestations of inter-municipal cooperation in their country. This chapter summarizes and compares the findings concerning the different countries in order to draw some general conclusions. The comparative analysis makes use of the conceptual framework presented in chapter I, which provides dimensions for the description of inter-municipal cooperation and offers factors to understand its presence and performance. Our concept of inter-municipal cooperation contains two basic elements. First, it refers to interactions between local governments and possible other public and/or private actors, which enjoy some degree of institutionalisation, i.e., cooperation that shows more or less stable patterns over time and occurs around certain standing issues, tasks or policies. Second, we reserve the concept of inter-municipal cooperation for entities and arrangements that formally depend on local government (or other participating public authorities) for their establishment and governance, thus excluding institutions that have been set up by local government, but enjoy a statutory independence (e.g., public and private companies, foundations). The comparative analysis starts with a description of the differences and similarities of inter-municipal cooperation in the eight countries vis-à-vis the dimensions presented in the introductory chapter. 2. Dimensions of Cooperation in Practice 2.1.

Composition: Pure inter-municipal cooperation versus mixed arrangements

The first dimension in the conceptual framework relates to the composition of the group of participants. Cooperation can be restricted to municipalities alone, but local governments can also extend their cooperative arrangements to include other public authorities (upper level government, specialised government agencies) or private sector organisations (foundations and companies). In this respect a distinction can be made between cooperative arrangements that are purely inter-municipal and arrangements with a mixed (public or public-private) character. What do the country studies show about the composition of cooperative arrangements? With the exception of the United Kingdom, there is a strong presence of pure inter-municipal cooperation in all of them. For other types, the picture varies. Mixed public arrangements are prominent in Spain and to some extent present in Belgium, but they are scarce or absent in the Netherlands, Germany and Finland. Mixed public-private arrangements can be found in all countries, but their frequency varies. Table 1 presents a picture of the situation in the eight countries. Pure inter-municipal cooperation can be considered the norm as it addresses direct needs for large-scale service delivery and coordination of the policies of a contiguous local governmental area. The large scale of British local government and the overall centralist organisation of spatial planning accounts for the absence of pure inter-municipal forms in the UK. But what about mixed forms? What can explain their presence and what issues are at stake?

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Table 1: The composition of cooperative arrangements Country Belgium

Finland France Germany Italy

The Netherlands Spain United Kingdom

Purely inter-municipal or mixed arrangements Mixed public arrangements and mixed public-private arrangements are present alongside purely inter-municipal arrangements, but new legislation forces municipalities to establish associations with a purely public character, limited participation of actors, and the exclusion of municipalities. Predominance of purely inter-municipal arrangements. Some mixed public-private arrangements in economic development, public transport and waste disposal. Strong presence of purely inter-municipal forms of cooperation alongside mixed public arrangements (syndicats mixtes). Strong presence of purely inter-municipal forms of cooperation; also mixed public-private networks in economic development planning (Regionalkonferenzen). Strong presence of different forms of purely inter-municipal cooperation in single- and multi-purpose service delivery (conventions, agreements, consortia, unions). Mixed public-private cooperation in social economic development (area pacts). Strong presence of purely inter-municipal organisations for service delivery. Limited number of mixed public organisations and networks. Strong presence of purely inter-municipal single- and multi-purpose associations (mancomunidades). Growing number of mixed public organisations (consortia). Strong presence of mixed public-private arrangements in service delivery (predominantly central-local); regional public-private networks for social-economic and spatial planning. Pure inter-municipal cooperation is promoted by central government.

Concerning cooperative arrangements with a mixed public-private character, it should first of all be noted that there are no standing organisations under public law where municipalities and commercial private companies jointly provide services to the public or to local government on a regular basis. The exception is Flanders, but recent legislation has ruled out this possibility (except for its lightest form of cooperation), and the existing mixed intercommunales are slated by law to be dismantled. The rationale behind this measure sheds light on the possible drawbacks of this type of cooperation. The Flemish legislator considered that mixed public-private associations lead to unclear responsibilities and potential conflicts of interest. In a number of countries, public-private cooperation is clearly present in cooperative arrangements concerned with social-economic development. Examples are the Regional Chambers in the United Kingdom, the Area Pacts in Italy and the Regionalkonferenzen in Germany. Typically, these less formally structured forms of cooperation are aimed at the coordination of public and private economic efforts, play a role in the development of programs for the European structural funds, and/or engage in the promotion of the regions involved. In general, accountability is not an issue, because there is no delegation of formal authority and all partners remain fully responsible for their own actions.

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The mixed public forms of cooperation present an interesting case. In some countries – Finland, Belgium, the Netherlands, Germany – standing organisations comprising municipalities and public authorities of upper level government seem to be avoided rather than encouraged. Recent Flemish legislation limits the (financial) participation of provinces in cooperative arrangements. Both in Flanders and the Netherlands, inter-municipal cooperation is primarily considered something that concerns local responsibilities and competencies. By contrast, Spain’s consortia, France’s syndicats mixtes and Italy’s programme agreements enjoy certain popularity. The main reason seems to be that the association of microscopic local government does not produce sufficient leverage for adequate service delivery and the expertise, capacity and financial resources of upper level government are required. The inclusion of upper level government as a partner does carry the risk of centralisation, as demonstrated by some of the Spanish consortia and Italian programme agreements (Font & Parrado Diez 2001, Torchia 1997), but they are still preferable from the perspective of effective and efficient service delivery. The UK presents the ultimate case of mixed arrangements: Driven by central government efforts to improve the performance of local government, they completely dominate the picture. 2.2. Types of tasks: Service delivery versus policy coordination The second dimension concerns the tasks involved in inter-municipal cooperation. We distinguish between service delivery tasks and policy coordination tasks. The former refer to the joint production of public services, where municipalities strive to overcome the limitations or inefficiencies of small-scale local government. Policy coordination concerns the regulation of externalities of local policies and the allocation of resources and costs that is rational from a supra-local perspective. Policy coordination tasks also include the joint activities of municipalities in order to influence other levels of national or European administration. In all countries included in this volume, inter-municipal cooperation arrangements apply mainly to service delivery. Table 2 shows that public service delivery dominates to a large extent. From a historical perspective, service delivery is the earliest objective of inter-municipal cooperation. In countries with a long tradition of inter-municipal cooperation – Spain, France, the Netherlands – local government has engaged in the joint construction of local infrastructure, the maintenance of cemeteries and the employment of local police officers since the late nineteenth century. Our data suggest that, overall, cooperation with respect to service delivery has intensified since the (late) 1950s, when the rise of the welfare state led to a growing level of public services that were, at least partly, to be delivered by local government. On the other hand, the national institutional context, legal frameworks and characteristics of the administrative system have been important determinants of the level of cooperation with respect to service delivery. The cases of Spain and Italy illustrate that changes in the administrative system in the 1980s and 1990s, resulting (respectively) in decentralisation and constitutional autonomy for local government, led to a substantial rise in cooperation. In contrast, the large-scale

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territorial reorganisation in the United Kingdom in the early 1960s kept inter-municipal cooperation with respect to service delivery at a very low level. Since the early 1980s, outsourcing and privatisation of public services have been a viable functional equivalent in some countries (UK, Finland), while in others New Public Management has not, or to a much lesser extent, eroded the producer role of the state (Spain, Italy, France). These elements of national context have a direct impact on the presence of cooperative arrangements involved in service delivery. Table 2: The tasks of cooperative arrangements Country Belgium Finland

France Germany Italy The Netherlands Spain United Kingdom

Public service delivery or planning and coordination Cooperation is almost exclusively limited to public service delivery. Public service delivery dominates to some extent, but planning for social-economic development and the management of EU structural funds at the regional level. New forms of cooperation emerge for service delivery and joint local development. Public service delivery dominates. Substantial number of associations in urban areas engages in spatial planning c.a. Public service delivery dominates to a large extent. Limited number of associations concerned with planning of land use, spatial planning and integrated regional planning. Public service delivery dominates to a large extent. Planning and coordination occurs with respect to social-economic development, and the provision of social and health services. Public service delivery dominates to a large extent. Limited number of arrangements engages in spatial planning and/or the planning of public housing. Public service delivery dominates to a large extent. Public service delivery dominates. Some planning and coordination for social-economic development on a regional level.

Policy coordination and planning through inter-municipal cooperation in some countries also have a long history. For most countries, however, the need to coordinate local policies to regulate externalities has substantially increased since the 1960s, especially in urban areas. From then on, processes of urbanisation and suburbanisation spread throughout Europe and called for the planning of housing, infrastructure and transport facilities on the level of urban agglomerations. In a series of countries, local government typically responded by establishing joint metropolitan authorities to fulfil the need for supra-municipal planning, either on a voluntary basis or at the instigation of central government (Germany, the Netherlands, France). Since the late 1980s, European integration and globalisation have increased pressures on local government and brought about new attempts to improve cooperation in urban areas. Moreover, these developments have given rise to new policy networks and institutions: planning institutions for the development of European Structural Funds programs (UK, Finland), urban networks that join cities in different provinces (the Netherlands), cross-border cooperation

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between contiguous regions (France–Spain, the Netherlands–Germany), and international urban networks to coordinate the coastal policies of cities bordering the North Sea. Again, differences between the eight countries with respect to the form and level of coordination and planning through inter-municipal cooperation can be explained by the national institutional context. The near absence of intermunicipal policy coordination and planning in Belgium is related to the facts that both the Flemish government and the five provinces established spatial plans that are binding for local government, and provinces are responsible for regional social-economic planning.1 The same goes for Spain and Italy, where the autonomous communities and the regions have developed into strong tiers of government that engage in social-economic and spatial planning. In contrast, the two-tier administrative systems of the UK and Finland furthered the development of cooperative arrangements for social-economic planning, for both national and European purposes. France presents a rather complicated picture, where several parallel and alternating strategies have been in use. The establishment of the regions (1982) created an institutional provision for regional social-economic planning and the regions have since broadened their scope of operation. However, they do not function as full-fledged regional governments with the authority to coordinate local government policies. This accounts for central government’s stimulation of the integration of planning functions in a series of new administrative forms of inter-municipal cooperation. Although the different national institutional contexts make it hazardous to generalize, it seems likely that cooperation will become more important, especially in those administrative systems that lack a strong intermediate level of government. Furthermore, one would expect a proliferation of policy networks that operate on a large sub-national or international scale. 2.3. Scope: Single-purpose versus multi-purpose arrangements Another descriptive dimension concerns the range of tasks and activities included in cooperative arrangements. A distinction has been made between single-purpose and multi-purpose arrangements, referring to entities that engage in just one or in a number of tasks. The country studies sketch a varied picture. In some countries (Spain, France, the Netherlands) single and multi-purpose arrangements are about equally popular. In other countries (Belgium, Germany, Finland) cooperative arrangements are predominantly single-purpose. One country (Italy) is characterised by the predominance of multi-purpose forms of cooperation. The picture is mixed, to say the least, and what is more, shifts between single- and multi-purpose organisations seem to go in opposite directions. In France single-purpose associations give way to multi-purpose arrangements; in the Netherlands multi-purpose service delivery authorities evolve into single-purpose ones. Spain’s predominantly single-purpose consortia enjoy an increasing popularity; Finland’s new cooperative arrangements tend to be multi-purpose. What issues are at stake?

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Table 3: The scope of cooperation Country Belgium Finland France Germany Italy The Netherlands Spain United Kingdom

Single-purpose or multi-purpose Cooperative arrangements are predominantly single-purpose. Multipurpose arrangements are present but must include functionally interdependent activities. Cooperative arrangements are almost exclusively single-purpose. New forms of cooperation tend to be multi-purpose. Both forms are present, the single-purpose arrangements clearly losing ground to multi-purpose arrangements. Cooperative arrangements are almost exclusively single-purpose. Predominance of multi-purpose forms of cooperation (conventions, unions, mountain communities). Both forms are present. There is a tendency to dissolve integrated associations into separate single-purpose arrangements. Both forms present. Mancomunidades are predominantly multipurpose. Consortia are predominantly single-purpose. Arrangements are predominantly multi-purpose.

Several circumstances and motives seem to favour the integration of a number of tasks into a single entity. In the first place, multi-purpose authorities seem to come into existence when the need for inter-municipal cooperation grows strongly over a relatively short time span. Examples are Spain and Italy. Spain’s process of decentralisation of the last decades resulted in a rapid increase in tasks and competencies for local government. Italy experienced transformations in the political and administrative system that put strong pressure on local service delivery and the economic performance of smaller communities. In neither country, however, were these system changes accompanied by a territorial reorganisation of small-scale local government. In these circumstances clear advantages to a strategy of cooperation consists in the one-time establishment of a joint authority and the successive integration of different tasks into the new institution. It saves the municipalities the sometimes complicated procedures of establishing new joint authorities (cf. Spain and Belgium), and there is no need to set up new councils and executive boards for policymaking and management. Furthermore, Italy’s regional governments stimulated the integration of different tasks into the same joint authority in an (albeit failed) attempt to pave the way for the amalgamation of municipalities. In the second place, the integration of different tasks into multi-purpose joint authorities serves to fight the fragmentation of inter-municipal cooperation that grows out of the incremental, piecemeal establishment of single-purpose cooperative arrangements. France and the Netherlands are examples of countries where intermunicipal cooperation developed over a long period and where municipalities set up stand-alone cooperative arrangements suited to the specific requirements of the task or service in question. This resulted in a patchwork of arrangements varying in composition from two or three immediate neighbours to a large parcel of local governments in the region. Although explicitly allowed or even sought after,2 in the long run the ad hoc development of inter-municipal cooperation had obvious drawbacks in terms of transparency and (political) control. Both France and the Netherlands

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have therefore tried to streamline and rationalize inter-municipal cooperation. In several instances over the last decades France introduced new multi-purpose administrative forms and stimulated the adjustment of cooperative arrangements to geographically coherent territories (urban areas and pays). In 1985, the Netherlands’ central government forced municipalities to integrate their single-purpose arrangements into multi-purpose authorities within a uniform sphere of activity. However, evidence from the countries under investigation suggests that when integrating different tasks into multi-purpose organisations, different logic competes for priority. On the one hand, decision making on and management of a specific task or service pose their own organisational demands. Waste disposal services require a scale of operation and a system of financing and management techniques that are quite different from the ones fit for the operation of an intermunicipal library or a joint tourist bureau. The integration of a series of different services into one standing organisation, under instruction and supervision of a board or council of local representatives, can bring along serious management costs without providing the most efficient organisational setting for each separate service. Spain and the Netherlands are cases where problems of the effective and efficient management of multi-purpose standing organisations have become manifest and have provided motives to set up single-purpose arrangements. However, the organisational integration of different tasks and services can also be profitable if they are somehow interdependent. We can distinguish two cases. The first one is closely related public services, those that form part of the same production chain or that can profit from shared knowledge and resources and/or require similar management and governing structures.3 The Netherlands is in the course of setting up joint authorities for emergency services, fire brigades and police forces to ensure coordinated efforts in emergency situations. The second is the case of different policy sectors that are mutually interdependent and where coordinated planning is a vital condition for effective and efficient local policies. In several countries under investigation – France, the Netherlands, and the United Kingdom – new administrative forms of cooperation integrate strategic decision making on mutually interdependent sectors such as socialeconomic development and spatial planning. The experience and trends documented in this volume suggest that in the long run two types of multi-purpose joint authorities will survive: those that integrate the delivery of closely related public services and those that integrate strategic decision making on mutually interdependent policy sectors. Otherwise, we predict a development of autonomization of inter-municipal public service delivery, either through loosening service agencies from the multi-purpose authorities they are embedded in, or disintegrating multi-purpose organisations into single-purpose organisations. 2.4. Institutionalisation: Networks, formal agreements and standing organisations Yet another descriptive dimension of the conceptual framework relates to the degree of institutionalisation of cooperation. Inter-municipal cooperation can take place using more or less loosely coupled policy networks that serve as a means for mutual

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consultation, coordination and joint decision making. The degree of formalisation is low, but the participants maintain contacts with each other on a regular basis (Hulst 2000: 23-26, Airaksinen & Haveri 2003: 8-11). Formal agreements constitute a more integrated form of cooperation. They can establish formal decision-making procedures for the coordination of local policies or organise service delivery between the partners, for example, outsourcing the activities to a participating municipality or private company. A standing organisation represents the most institutionalised form of cooperation. It implies the integration of activities formerly carried out individually by municipalities into a new organisation jointly run by the municipalities and any admissible participants. What are the research findings with regard to the dimension of institutionalisation? In all countries, cooperating municipalities make use of standing organisations for service delivery. It is often the way to provide basic services like water distribution, waste disposal, fire brigades, public health or environmental protection. Formal agreements are, however, in some countries a functional equivalent for standing organisations. This form of cooperation enjoys certain popularity in Finland, the Netherlands and Italy. Table 4 provides an overview. Table 4: Degree of institutionalisation Country Belgium Finland France Germany Italy The Netherlands Spain United Kingdom

Standing organisations, formal agreements or networks A range of different standing organisations, light and heavy forms Predominantly standing organisations, alongside growing number of contract-based cooperations and informal networks. Predominance of standing organisations. Single-purpose standing organisations for service delivery alongside networks for (social-economic) planning. Standing organisations and agreements for service delivery, agreements for social-economic development, networks for planning. Service delivery almost entirely through standing organisations; also core city agreements for service delivery. Networks for planning. Predominance of standing organisations. Predominance of agreements for service delivery. Networks for socialeconomic and spatial planning.

Two issues seem to be at stake when it comes to the choice between setting up a standing organisation or establishing a service agreement. The first has to do with the costs of a new organisation. Although in principle a standing organisation creates economies of scale, formal procedures for the establishment of joint organisations, joint management, and provisions for control and accountability of local councils involve additional costs. Organising supra-municipal service delivery through formal agreements can, on occasion, create the same economies of scale at lower management costs. The second issue concerns the lack of flexibility of standing organisations. Adapting standing organisations to new circumstances often requires formal decision-making procedures involving all the participating municipalities and possible other partners. Finland provides a good example of a country where more flexible contract-based arrangements are replacing service delivery through standing

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organisations. In Belgium, despite the fact that new legislation introduced lighter forms of cooperation, municipalities object to the fact that they have to follow all kinds of rules and regulations for the establishment of standing organisations, cannot tailor cooperation to their specific needs and are faced with costs when they want to intensify cooperation or adapt it to new circumstances. Policy networks seem to be in use for two kinds of activities. The first concerns the exchange of knowledge and best practices. The second concerns policy coordination, especially in sectors like spatial planning and economic development. There are, however, notable differences between and within the countries included in this study. In some, like Germany and the Netherlands, municipalities rely almost exclusively on networks for policy coordination. In France, there are pressures from central government to integrate planning tasks in standing organisations, especially for the urban areas. The French case shows, however, that if left to the municipalities they prefer lighter forms of cooperation, which do not imply the transfer of local decision making to standing organisations or any other form of formal engagement. Municipalities do not on a voluntary basis give up local autonomy for the sake of policy coordination. All in all, it can be concluded that the degree of institutionalisation municipalities choose seems to be contingent on the start-up costs, the required flexibility and the kind of tasks that have to be performed. 2.5. Decision-making powers: Regional authority versus regional agent The dimension at hand is closely related to the degree of institutionalisation, namely the extent to which municipalities have transferred decision-making powers to the cooperative arrangement in question. A precondition for the transfer of decisionmaking authority is the presence of a standing organisation. The dimension relates to whether a standing organisation operates as an agency of the municipalities, servicing local governments at their request and with the full preservation of the competencies of local government, or if it assumes the competencies and authority of local government, deciding and acting in its place. We refer to the latter as regional authorities, to the former as regional agents. What is the state of affairs in the investigated countries? In most, both regional authorities and regional agents exist. The Belgian case study presents a clear example of both types. The so-called mandated associations (opdrachthoudende vereniging) and service associations (dienstverlenende vereniging) are both standing organisations governed by a general council; they possess legal personality and have their own staff of officials. However, they differ with respect to their decisionmaking powers. The mandated associations have decision-making powers transferred to them by the municipalities. The service associations go without independent decision-making power. They work under the authority of the municipalities and carry out their orders. Table 5 presents information about the presence of regional authorities and regional agents in each of the investigated countries. From the data we have gathered, it is difficult to be conclusive about what determines whether cooperation is set up as an agency or an authority. One factor seems to be that local government in general strongly adheres to its autonomy and that no transfer of local competencies takes place unless compelling motives are

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present. If cooperation concerns public service delivery, the characteristics of the service itself play a role. In some cases a transfer of competencies does not come into discussion, because the service involves the technical support of the local apparatus or policy-making practice. In some cases, the service lends itself to individual municipalities for delivery and pay-on-demand. Then an agency that operates on the instructions of the individual participants is a viable construction. In some cases, there are different options available. The Netherlands has are both regional agencies and regional authorities involved in the provision of social services. The regional agencies put their personnel and services at the disposal of the participating municipalities, but each local government acts as the formal decision maker and establishes its own policy guidelines. The regional authorities do not only carry out the necessary activities, but also act as formal decision makers themselves, and the regional councils set policy guidelines and instructions. In these cases, the type of standing organisation seems to depend on the political preferences of the partners. In other cases, however, when services have some of the characteristics of a pure public good (non-exclusivity, non-rivalry) a transfer of decision-making powers is inevitable. If for reasons of scale municipalities decide to establish a regional fire brigade, they must transfer decision-making about its availability, quality and financing to a regional authority to prevent free-rider behaviour by individual municipalities. Table 5: Extent of decision-making powers of standing organisations Country Belgium Finland France Germany Italy The Netherlands Spain United Kingdom

Regional authorities or regional agents Majority of standing organisations are regional agents. Regional authorities alongside regional agents Predominantly regional authorities Predominantly regional authorities Mixed: both regional authorities and regional agents. Predominantly regional authorities. Predominantly regional authorities Standing organisations are scarce: predominantly regional agents.

Furthermore, it is clear that local governments are very reluctant to attribute formal planning or fiscal authority to joint standing organisations. There are no examples of regional planning authorities set up by municipalities on a purely voluntary basis. In several countries, regional planning authorities, which exist in urban areas more than anywhere else, are the result of pressures and incentives from upper level government. In these cases, municipalities do their best to hollow out the minimal obligatory competencies of the regional authorities and neglect the principle of exclusivity that forbids them from being active in the policy sectors that have been transferred to the regional authority. Both France and the Netherlands provide good examples of the general resistance towards more federative forms of cooperation. With respect to planning and coordination, it is likely that, as the interdependencies between local policies become increasingly stronger, federative forms of cooperation will force themselves upon local government. In the long run, a failure to provide for the adequate coordination of local policies will almost certainly provoke large-scale territorial reorganisations or the centralisation of decision making. With

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respect to service delivery, there is no reason to expect that the present picture of the use of regional agents and authorities will change substantially in the near future. National traditions, the importance attributed to local autonomy, and the technical features of the tasks involved will determine which form cooperation will take. 2.6. Democratic legitimisation: Political representation and accountability The last descriptive dimension of the theoretical framework involves the organisation of political representation and accountability. Like the previous one, this dimension only applies to situations where cooperation takes the form of standing organisations. Of course, standing organisations endowed with exclusive competencies and formal decision-making authority present the most interesting case. No taxation without representation. The more powerful and autonomous the regional authority, the more it engages in decisions that directly affect the interests of the local communities and their citizens, the stronger the call for direct elections of their governing councils. The presence of regional authorities notwithstanding, direct elections of the studied countries’ governing councils do not occur. An exception is Finland, where direct elections form part of an experiment to foster inter-municipal cooperation. Table 6 provides an overview. Table 6: Representation and accountability Country Belgium Finland

France Germany Italy The Netherlands Spain

United Kingdom

Elections and accountability arrangements General councils of standing organisations consist of representatives of the municipalities. Council members are accountable to the local councils. General councils of standing organisations consist of representatives of the municipalities and must reflect political balance of power. No specific rules for the accountability of council members to local councils. New experimental forms of cooperation include direct elections of the general council. General councils consist of representatives of the municipalities. No rules with regard to the accountability of council members to the local councils. General councils of standing organisations consist of representatives of the municipalities. Council members are accountable to the local councils. General councils consist of representatives of municipalities and must reflect political balance of power. No specific rules for the accountability of council members. General councils of standing organisations consist of representatives of the municipalities. Statutes must regulate the accountability of council members to the local councils. General councils of standing organisations consist of representatives of the municipalities. Representation must reflect the political balance of power. No specific rules with regard to the accountability of council members to the local councils. Standing organisations are scarce. No legislation with regard to representation and accountability.

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The rationale for the reluctance to introduce direct elections seems clear: it would turn inter-municipal institutions into regional or upper level local governments in their own right. In some countries an extra level of regular administration is thought too much for an already densely populated administrative system. In all countries, it would pose a threat for the vested interests of local government and its autonomy or even for the existing regional government. In the absence of direct elections, debates focus on the way local government is represented and on accountability relations between the inter-municipal and the local councils. The general picture is that the governing councils consist of representatives of the municipalities and other participants. But what are the guiding principles for representation? The different country studies illustrate the different options and the role political culture plays. Although Spanish legislation leaves it to the participants to establish the system of representation, it is generally understood that it should reflect the balance of political power. One of the objections against L’Horta, a metropolitan area in Valencia, was that the council consisted only of mayors, representing the dominant political forces in each of the municipalities and thus excluding the local political opposition from the inter-municipal council. Therefore, it is common to find statutory provisions regarding the proportional representation of the different local political forces.4 This fits the highly politicized relations in Spanish local government. In the same way, the statutes of Italian mountain communities contain provisions to safeguard the representation of both majority and minority parties.5 In a much less politicized environment, like the Netherlands, the focus lies more on the representation of the municipality as such. Thus it is not uncommon to find systems of representation where each municipality delegates only one member to the regional council, who is then entrusted with a number of votes that corresponds to the size of the municipality.6 Reflecting on the different arrangements present in the eight countries, we suspect a relationship between systems of representation and accountability procedures. Systems that provide for the representation of different political forces lack detailed procedures to hold members of the inter-municipal council accountable to the local council. In cases where members of a local council or board represent their community rather than their political party, the cooperative arrangements provide for proper information relations and accountability procedures between the two levels.7 In the absence of direct elections, both arrangements pretend to secure a proper link between the inter-municipal council and elected local politicians in order to uphold the democratic legitimacy of decisions and policies of the inter-municipal authorities. This exercise may become increasingly difficult as the responsibilities and competencies of the inter-municipal authorities grow and the centre of gravity of local administration moves from the local to the inter-municipal level. In the long run, it will prove unacceptable for inter-municipal institutions to grow into multipurpose quasi-regional governments without proper democratic legitimization. As the history of inter-municipal cooperation in some of the countries shows, there are two ways out. The first is to curtail inter-municipal cooperation. This is what happened in the Netherlands in the early 1980s, when cooperation was considered to have gotten out of hand. Legislation put a tighter grip on the local councils of inter-municipal institutions and quasi-regional governments were dismantled. In

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Flanders, as a result of recent legislation, local councils will be more involved in governing the different forms of inter-municipal cooperation, and the former intercommunales will be dissolved. The second, as mentioned above, is to turn to direct elections of the inter-municipal councils. This is a radical step: It immediately relates to the position of local government itself, especially when inter-municipal councils, as in France, have decision-making authority over the tasks and responsibilities to be transferred from local government to the inter-municipal level. Seen from another perspective, the introduction of direct elections might prove to be the way to achieve large-scale territorial reorganisation without actually resorting to the often opposed amalgamation of local government. Municipalities would not cease to exist, but would develop into entities comparable to the English parishes, with limited or no formal competencies. 3. Four Basic Types of Inter-municipal Cooperation By now it has become clear that there is a wide variety of cooperative arrangements in the European countries included in this volume. However, if we take into account the tasks involved in the cooperative arrangement and the degree and form of institutionalisation, it is possible to group four basic types, which are present to some degree in all countries: • • • •

Semi-regional government: standing organisations with decision-making authority involved in the planning and coordination of local policies Service delivery organisation: standing organisations involved in service delivery Service delivery agreement: contract based cooperation with respect to service delivery Planning forum: loosely coupled networks involved in the planning and coordination of local policies

We will discuss these four basic types of cooperation in detail and focus on two issues. The first is to try and explain the presence and characteristics of the different types from the national institutional context and the elements of this context that specifically relate to cooperation. These include the main characteristics of the national administrative system and local government’s position in it, as well as the legislation and incentive structure for cooperation.8 The second relates to the performance of the different types of cooperation in terms of efficiency, efficacy and democracy. The main issue here is to explain performance from the features of the cooperative arrangements themselves, i.e., their administrative form, governance structures and the organisation of political representation. 3.1. Semi-regional government Semi-regional governments are standing organisations established or governed by municipalities, invested with the authority to coordinate local government policies in one ore more sectors, and entrusted with the corresponding competencies and

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resources. As a rule, they have a multi-purpose character and are sometimes are also involved in service delivery. Planning tasks frequently involve spatial planning and social-economic development; public transport, emergency services, water distribution and waste disposal are often the services provided. Typical examples of semiregional governments are or were at some time present in Germany (different types of Verbände in urban areas, some of them now replaced by independent authorities), the Netherlands (metropolitan authorities in seven urban agglomerations), France (the communautés d’agglomeration and the communautés urbaines) and Finland (regional councils and the Helsinki metropolitan area). Evidence from the country studies shows that the presence of semi-regional government bears no relation to the average size of local government. It results from a combination of three circumstances. The first is the presence of strong natural, social and economic interdependencies in a region, which call for policy making and planning on a supra-municipal level. These interdependencies are always present in metropolitan areas with high population densities, but also occur in rural or semi-rural areas with regional urban centres. The second is the absence of a strong intermediate tier of government that fulfils planning functions. Typically we do not find semiregional government in the metropolitan areas in Spain where decentralisation has produced regional governments with a range of planning functions and formal competencies in local government. In addition, these governments generally have their seats in the regional metropolis. Semi-regional governments would in such circumstances produce a crowd of administrative bodies. Belgium presents a similar case, where the federal government, the Flemish state, the Flemish community and the provinces already produce a high density of administration and make semi-regional government redundant. In contrast we find semi-regional governments in metropolitan areas in countries with a relatively weak intermediate tier of government (France, the Netherlands), with no intermediate government (Finland) or in countries with a federal character where the states function at some distance from local government (Germany).9 The third circumstance relates to the interventions of central or upper level government. As a rule and due to the fact that semi-regional government implies the transfer of decision-making power, local government does not establish semi-regional government on a strictly voluntary basis; it needs incentives to do so, legal or financial. These include administrative forms that imply compulsory functions, the right to levy taxes or the allotment of specific grants to finance projects for the joint municipalities. In the absence of strategies from upper level government to promote semi-regional government, it does not flourish, even if the need for coordination and planning is obvious and no functional equivalent is available. The failures in establishing planning authorities in metropolitan areas in the Netherlands and Italy provide ample evidence for this. The relatively strong presence of semi-regional government is clearly related to central government interventions. How do semi-regional governments perform? First of all, the country studies in this volume provide only limited insight into the actual performance of semi-regional government. However, the evidence presented makes it possible to sketch some general patterns and discuss some of the related issues. The central problem of semi-regional government seems to be its hybrid or federative character. On one hand it is supposed to function as an autonomous public

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body establishing policies and plans from a supra-municipal or regional perspective. These policies must set conditions for local government, constrain its discretionary power and involve the allotment of financial resources. From a functional perspective, semi-regional government must operate as a form of upper level government that is hierarchical to local government. On the other hand, semi-regional government has strong ties with the municipalities it is supposed to govern. With the exception of Finland and Germany,10 all countries’ semi-regional governments are managed by councils and executive boards that consist of representatives of local government. In the end, the regional councillors and governors are accountable to their local constituencies, whose primary interests lie with the local and not regional community. The performance of semi-regional government seems to relate directly to whether the local or the regional perspective gains the upper hand. If the latter is the case, semi-regional government produces plans that actually coordinate local policies that address issues of spatial planning and social economic development for the region as a whole and it allocates financial resources accordingly. If local interests dominate decision making in the regional councils and boards, semi-regional governments act as empty shells that produce symbolic policies, and gratefully accept the financial resources put at their disposal only to distribute them amongst the municipalities according to general criteria like population. Semi-regional government in France and the Netherlands provides ample evidence for this. The country studies suggest a range of factors that determine the performance of semi-regional government. One factor concerns the type of interdependencies between the municipalities involved that result from the geographical, spatial and social-economic characteristics of the region. If a common policy can actually produce synergy and municipalities are aware of that fact, or if the well being of a centre city is intrinsically linked to the well being of contiguous municipalities, a regional perspective gets the chance to dominate. But if regional contingencies imply competition between the municipalities involved, either real or fancied, it is likely that semi-regional governments will not fulfil their planning tasks in an adequate way. Apart from the regional circumstances, our data suggest that the political context, the cultural commitment to genuine cooperation, and elements of the institutional design of the regional authority also bear on the performance of semi-regional government. The latter include decision-making rules in the council and the organisation of the representation of local government. Stipulations that allow a qualified majority of the regional council to decide on the transfer of local competencies to the regional level, majority voting within the councils, and representation along political lines seem to have a positive impact on the performance of semi-regional government. Unanimity rules and representation along territorial lines have the opposite effect, as both the French and the Dutch practice of cooperation show (Hulst 2005). Of course, the establishment of a directly elected autonomous regional government could satisfy the need for planning and coordination of local policies, as could the transfer of local decision-making power to an existing intermediate level government. But this would imply a permanent erosion of local autonomy. In theory semi-regional government can provide for regional governance without hollowing

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out local autonomy. The evidence suggests, however, that for semi-regional government to be effective the institutional design must contain provisions to balance the local and the regional perspectives on policy issues. One could, for example, think of the introduction of a two-chamber system of governing councils – one representing the municipalities, one representing the regional constituency. As in national federative administrative systems, this could provide for the necessary balance between local and regional interests. Admittedly, it is a more costly and laborious solution, but some provision is required. If local perspectives structurally dominate, as they seem to do, they will undermine the legitimacy of semi-regional government. 3.2. Service delivery organisations Service delivery organisations are standing organisations involved in the delivery of public services. They can dispose of their own decision-making powers transferred to them by the cooperating municipalities (and other government organisations), or they can function as agents on the instruction of individual municipalities. Although in some countries, like Spain, mixed forms occur, service delivery organisations are predominantly purely inter-municipal. Service delivery organisations are found in all investigated countries but with great diversity. Sometimes only a small number of municipalities participate; in other cases numerous municipalities are involved. Moreover, the organisations vary – albeit to a lesser degree – with respect to the scope of their tasks. There are both single-purpose and multi-purpose organisations, although the former seem to dominate. With respect to the explanation of the presence of service delivery organisations, the scale and domain of local government seem to be the main factors. Service delivery organisations have proven to be popular in countries where municipalities have substantial responsibilities in the field of service delivery. In these countries (Belgium, France, Germany, Spain, Italy and the Netherlands), service delivery organisations exist especially, although not exclusively, in areas with a number of small municipalities to overcome limitations of scale. The large scale and limited autonomy of local government in the UK explains the near absence of this basic type of cooperation in that country. The evolution of service delivery organisations is a process with its own dynamics. A considerable expected economic advantage of cooperation is sufficient stimulus for municipalities to set up a service delivery organisation. In contrast with semi-regional governments, service delivery organisations flourish without special encouragement or measures from central government. The establishment of a standing organisation is not, however, the only way to overcome the limitations of scale. There are at least three other solutions. A first alternative is the transfer of tasks to an already existing administrative authority at the regional level. In France, for example, the départements have stepped in to provide municipalities with basic services. In Spain, legislation assigns the provincias as the administration that must assist local government when it is unable to provide services, but in practice this rarely occurs. This alternative is not a realistic option if the regional authority is not sufficiently equipped for service delivery.

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This is the case in Italy, where regional authorities are mainly responsible for policy coordination and planning. Moreover, the municipalities seldom support the assignment of tasks to the regional level because it affects their position. A second alternative for the establishment of a joint standing organisation is to contract services out to a private firm. Municipalities see this as a viable option for tasks of a non-political character. Think, for instance, of service delivery tasks in the fields of waste disposal, water distribution, public transport and energy supply. In the case of tasks of a more political nature, say, social security services and environmental protection, municipalities are usually not willing to follow this strategy. The phenomenon of outsourcing is frequently found in Germany, the UK, France, Finland and the Netherlands, countries where New Public Management has increased in popularity over the last decades. For the last alternative, a municipality enters into a contract with a neighbouring municipality of considerable size to transfer one or more specific service delivery tasks to it. This cooperative arrangement can be labelled as a service delivery agreement and will be discussed in more detail in the next section. The country studies provide limited information about the performance of intermunicipal service delivery organisations, and we can present only some tentative observations. The first is that the picture is mixed. Throughout the different countries examples can be found of service delivery organisations that perform relatively well in terms of service quality and cost effectiveness. The joint body for police services in the Italian region of Emilia Romagna provides a good example. This new service delivery organisation carries out fifty types of activity using a three-shift system, three cars and a staff of eight who issue eight thousand fines per year. Prior to the creation of their joint structure, the same bodies had identical cost levels, operated a two-shift system and performed only thirty-five functions producing a lower number of fines. In the UK, councils expect to realise savings by sharing services such as the management of revenue collection and benefit payments, transactional services and information technology. But the country studies also show examples of failure and poor performance. In 2000, eighteen unions of communes were formed in the Italian area of Friuli. As a result of the inability of the communes involved to achieve an effective form of joint management, two were dissolved the following year while two others never got off the ground. In view of their poor performance, the regional authority decided to favour the “extinction” of some unions. By 2004, only three unions remained. There is hardly any evidence to make statements about the performance of joint standing organisations compared to stand-alone municipal agencies. Research into social service delivery in the Netherlands shows that the different forms of cooperation present in that country do not perform statistically significantly different from stand-alone organisations with respect to providing income relief and reactivation activities for the unemployed. However, the data available do not allow conclusions about the specific performance of service delivery organisations. The second observation is that there are a series of factors that can explain the performance of service delivery organisations. These include the availability of financial resources, qualified personnel and management capacity. Even if these are not structural factors, they cause problems during the start-up period of service

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delivery organisations. The Italian country study provides the example of the region of Tuscany where the municipalities concerned had difficulty finding personnel qualified to manage and develop the joint management structures that had been created. Particularly in situations where there has been no significant previous experience, substantial start-up costs have to be taken into account. Evidence from Spain suggests that the mancomunidades are limited by the fact that they depend on the contributions of the participating municipalities, whose financial position is generally poor – one of the reasons for the shift to cooperative arrangements that include upper level government entities. Although the evidence is scant, there are indications that at least two elements of institutional design have a negative influence on the performance of service delivery organisations: the scope of cooperation and the organisation of political decision making. The Dutch and Spanish experience suggests that multi-purpose organisations are more difficult to manage than single-purpose organisations. In the Netherlands, in spite of the legal obligation to integrate different tasks into one multi-purpose organisation, municipalities have in recent years dismantled multipurpose organisations and created single ones. One of the reasons for the growing popularity of the Spanish single-purpose consortia seems to be that they are easier to manage. With respect to the role of the organisation of political decision making, inter-municipal organisations governed by councils where the participating municipalities – frequently a large number – decide by consensus make for slow and inefficient management. Honouring the principles of political representation and accountability is thus not without costs in terms of efficient and effective management. It is clear that much more research is required to make more conclusive statements about the factors that determine the performance of service delivery organisations. In all investigated countries there are serious doubts about the democratic quality of service delivery organisations. The problem is not so much the formal rules and procedures. In general, these ensure that elected local council members take part in the governance of the inter-municipal councils and boards. In practice, however, instruction and control of the inter-municipal executive boards by elected representatives is often almost absent. Moreover, accountability and control by local councils are sometimes hampered by the fact that joint authorities themselves engage in cooperative arrangements on a larger territorial scale. An example is France, where the inter-municipal entities transfer tasks to larger syndicats mixtes, which in turn may contract services out to a private utility. As a consequence, inter-municipal organisations frequently tend to assume a life of their own, detached from the discretionary political power of the municipalities. All in all, when it comes to inter-municipal service delivery, the interests of the local citizen seem ill-represented. For this reason, there are regular attempts to strengthen the democratic control on inter-municipal cooperation. In Belgium, for instance, a new decree tries to meet the frequent criticism on the classic service delivery organisations, the intercommunales, that there was insufficient control from the local councils on their decisions. Experience from the Netherlands, where a similar operation took place in the 1980s, suggests being not to too optimistic about the impact of new competencies for local

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councils to influence decision making by inter-municipal organisations. The democratic control of service delivery through inter-municipal cooperation should be a subject of constant concern. 3.3.

Service delivery agreements

Service delivery agreements are characterised by the fact that the participating actors enter into a formal agreement to cooperate in the delivery of services without establishing a joint standing organisation. In practice, they are used to organise service delivery in a number of ways. In some cases the agreement implies that one of the partners, frequently the largest municipality, renders and sells services to the other partners. In other cases, municipalities use agreements to create buying power for outsourcing service delivery to private companies. Both these types of agreements can be found in Italy (conventions), the Netherlands and Finland. Generally, the agreements comprise a single service. Service delivery agreements are to a large extent functionally equivalent to service delivery organisations. They help communities deal with constraints resulting from their small scale. However, there are some advantages compared to the establishment of standing service delivery organisations. In the first place, using agreements, municipalities can avoid the start-up costs and costs related to the governance and management of a joint organisation. Small communities can thus profit from the experience and knowledge built up by service delivery agencies of their big neighbours or by private companies. In the second place, agreements have the advantage of flexibility, which makes them appropriate instruments in the case of new services, tasks or projects with a temporary character or services that have to be rendered in a dynamic environment. In this respect reference can be made to Finland, where contract-based cooperation is becoming increasingly popular and is even replacing joint service delivery through standing organisations. The country studies provide meagre evidence on whether service delivery agreements actually serve to enhance the quality of service delivery and create economies of scale. Research is required to provide a basis for conclusive statements about their performance. The management of service delivery then would merit special attention, as this form of cooperation, in contrast to standing organisations, lacks a built-in management structure. In most countries, service delivery agreements are purely inter-municipal. In Italy and the UK, however, there are service delivery agreements in use with a vertical character. In most cases the agreements organise cooperation between individual municipalities and a series of (semi-)autonomous public agencies, agencies of regional or central government and, in the UK, private actors. Their purpose is not so much to create economies of scale, but to give municipalities access to the resources of central government and to coordinate the delivery of different services. In Italy the vertical program agreements coexist with other types of cooperation. In the UK cooperation is predominantly vertical in character. Good examples are the Local Public Service Agreements (LPSAs), which are instruments to drive up performance and quality of services by contracts between service delivery bodies and the Treasury. The LPSAs were first set up in 2000. Second-generation LPSAs have been

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implemented and were completed very recently. Both central and local government communities concluded that the first round of LPSAs were broadly successful. However, they also noted a number of limitations. Central government did not, for instance, make enough effort to empower the local councils to take action in their chosen target areas. Therefore, the second-generation LPSAs introduced more room for a local focus and priorities. A similar problem has been noted with regard to the Italian program agreements and the Spanish consortia with a mixed public character. This gives rise to the conclusion that in vertical cooperative arrangements, local government runs the risk of sacrificing policy discretion in exchange for the access to resources or the cooperation of upper level government. Further research into vertical agreements should not fail to pay attention to this issue. 3.4. Planning forums Planning forums are loosely coupled networks of municipalities and other public or private actors that engage in the coordination of their respective policies or activities in one or a number of related policy fields. Their institutional integration is low: participants maintain more or less stable relations and they interact on a regular basis. There is no standing organisation with formal competencies, although a support staff may be present. There is no issue of democratic legitimisation or representation, because every participant is responsible for his own actions and decisions and can be held accountable for them through the appropriate procedures. Planning forums exist in all investigated countries in some form or another. They are especially active in the fields of spatial planning, social-economic development, public housing and environmental planning. We can distinguish three types of networks. The first covers coherent territories and consist of municipalities only, aiming to fulfil the same functions as semi-regional governments. The second type is also bound to a specific region and includes public actors from different administrative levels, businessmen, chambers of commerce, universities, civic associations and local interest group representatives. The Italian area pacts and the German regionalkonferenzen are clear examples of this type. The participants collaborate in the exchange of best practices and the development of social-economic programmes. A third type includes networks that cross regional or even national borders and integrate public and private actors on a functional basis. The urban networks in the Netherlands incorporate cities with a regional function trying to coordinate their investments in economic, social and cultural projects and to join forces in order to acquire the necessary funds from national government and Europe. Urban networks incorporating cities bordering the North Sea or the Mediterranean engage in Integrated Coastal Zone Management. In general, the first type of inter-municipal networks appears to come into being under a combination of circumstances. One is the presence of strong local government responsible for tasks like public housing, transport and infrastructure, socialeconomic development and environmental policies – tasks that experience substantial externalities. The second is the absence of an intermediate administrative level with a general competence to coordinate local government policies. The third circumstance is the absence of central government strategies to promote the

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establishment of semi-regional government. The presence of a relatively strong intermediate government in Spain and Italy explains the absence of inter-municipal planning forums in both countries. Over the last decade, France’s central government has been promoting the establishment of semi-regional government to execute planning tasks. In the rural areas in the Netherlands, where central government has left cooperation at the will of local government, inter-municipal planning forums flourish. Strong local government does not voluntarily transfer planning authority to inter-municipal organisations, even if these are fully controlled by the joint municipalities. Cooperation in a planning forum keeps local autonomy intact, as decision making generally takes place on the basis of consensus. Drawing on experience in the Netherlands and Germany, pure inter-municipal planning forums do not appear to be very effective. Networks with a certain tradition of cooperation perform relatively well, but in the end it is the interdependencies between the participants that determine success. Planning and coordination frequently fail because of conflicting interests between municipalities, which are part and parcel of the tasks involved. Inter-municipal planning forums, which are structurally set up to coordinate local government policies with substantial externalities, constitute a poor substitute for regional or semi-regional government. Although the two other types of planning forums we distinguished also deal with possible conflicts of interests between the participants, there is reason to be more optimistic about their performance. First, the mixed forums referred to generally constitute networks with an open character: They are not bound to a predefined territory and they integrate public and private actors, different administrative levels and policy sectors according to need. Flexibility opens the way to establish networks with requisite variety, i.e., to tailor the composition of the network to the features of the policy issues at hand. Second, the mixed character of the networks creates favourable conditions for the development of new strategies and coalitions, and for bridging traditional gaps between disciplines, policy sectors and public and private domains. This does not mean that planning and coordination in mixed and functionally orientated networks is an easy task. It takes considerable time and effort to develop the Italian Area Pacts and Zone Plans. The strategy documents in the urban networks in the Netherlands include symbolic policies to some extent. Mixed and functional planning forums express the need to address social complexities on an ever-growing scale for which, as a rule, no functional equivalent is available in the form of standing government organisations. Although the presence of purely intermunicipal and territorially-bound planning forums may be considered a token of failure to create structural administrative provisions for the coordination of local government policies, mixed and functional planning forums represent a necessary, though not always effective, supplement to the standing administrative structure. 4. Strategies to Promote Inter-municipal Cooperation This book began with the assumption that there is a growing need for intermunicipal cooperation, given the increasing scale of production of public services, the increase in externalities of local policy making and growing pressures from the

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(European) market. In the countries included in this volume, inter-municipal cooperation is clearly on the rise; functionally equivalent strategies like centralisation of service delivery and policy making or large scale territorial reorganisations are not on the present agenda. There are, however, substantial differences in the way countries deal with the growing need for cooperation. One approach is to leave cooperation at the will of the municipalities, apart from offering legal frameworks with minimum standards and procedures for the establishment and governance of joint institutions. All countries included in this volume have at some time in history taken the stand that cooperation is a matter of the municipalities themselves, to be set up as circumstances require. Moreover, the dynamics of the administrative system and the existing balance of political power do not always make it attractive for upper level government to promote cooperation and thereby contribute to the rise of countervailing forces (cf. Italy). On the other hand, almost all countries have, at some point, actively promoted inter-municipal cooperation. There seem to be three motives for central governments to choose an active approach towards cooperation. The first is to pursue or guarantee minimum standards in service delivery or policy making in specific policy sectors. Typical examples concern interventions of central government to secure the presence of a regional fire brigade, regional emergency services, environmental agencies, and health or social services. In general, it involves vital functions of local government that need a certain minimum scale of operation. The second motive relates to the need for metropolitan governance. It is especially in the metropolitan areas that the complex interdependencies between city centres and peripheral communities call for governance at the scale of the metropolitan region. Although from a perspective of rational governance a unitary metropolitan government may be preferable, the historic presence of small scale municipal government and political resistance to radical territorial reorganisation often leaves no other option than to achieve metropolitan governance through cooperation between the municipalities in the area. The third motive stems from the need for an overall improvement of the performance of the local administrative system. Cooperation is then seen either as a first phase in a process of amalgamation (cf. Italy between 1990 and 1997) or as a permanent functional equivalent for the up-scaling of local government (cf. France after 1990 and the UK). Overall, three methods are in use to promote cooperation. The first is to turn it into a statutory obligation. These obligations can take different forms. In some cases legislation that establishes the administrative system for a specific policy sector prescribes that municipalities set up a joint authority to carry out a specific task. Under Dutch legislation on emergency services, municipalities must set up a joint authority for ambulance transport services. In other cases legislation creates administrative forms for cooperation that include compulsory functions. This is the case with different inter-municipal structures in France and with the special regime for metropolitan areas in the Netherlands. The second method to promote cooperation is the use of financial incentives. In some cases these take the form of a compensation for the operational costs involved in tasks to be carried out by the joint authority. Examples are the grants offered in some regions in Italy, grants to establish environmental inspection services in the Netherlands and grants for the inter-municipal planning of health care services in

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Finland. In other cases cooperation between municipalities serves as a condition for the attribution of financial resources to facilitate projects or activities of the municipalities, private actors or the joint authorities themselves. These resources can originate from the right to levy taxes (France), from upper level government grants (the Netherlands) or from the European Union (Finland). The use of statutory obligations and financial incentives to promote intermunicipal cooperation is quite common. In two of the countries researched we found a third method that concerns the delegation of decision-making power from upper level government to joint authorities. Spanish legislation allows the autonomous communities to establish metropolitan authorities for urban agglomerations and comarcas for rural areas. Municipalities are in control of the authorities; they carry out delegated functions and serve as a joint authority for service delivery and coordination of local government policies. In the Netherlands, provinces have on occasion delegated decision-making power to an existing joint authority under the condition that municipalities simultaneously transfer some related local competencies to this authority. Evidence suggests that this strategy may be effective if upper level government delegates substantial power to the joint authorities (which was not the case with the Spanish metropolitan areas) and supervises joint authorities to prevent symbolic policy making (which did not happen in the Dutch case). What can be said about the success of the two main methods to promote cooperation? First of all, this particular matter has not been the subject of systematic research in the countries included in this volume; our evidence is fragmented and partly anecdotal. However, the country studies suggest that the first method, the use of statutory obligations and conditions with respect to cooperation, frequently meets with resistance from local government and gives rise to avoidance strategies. In Italy, under the detailed national legislation of 1990 and additional conditions formulated by regional legislators, the process of establishing joint authorities took off slowly, only to accelerate after obligations and restrictions were substantially reduced in 1999. France is a good example of an administrative practice where local government systematically chose to work under those administrative forms that leave them the most scope to work out for themselves which municipal functions are transferred. In Belgium, local government has welcomed the introduction of new and lighter administrative forms of cooperation, with relatively few formal restrictions and conditions, and have since avoided the heavier, more regulated forms. Although in general local government does not welcome statutory obligations and formal conditions for cooperation, municipalities are not always in a position to ignore the legal requirements or to choose not to engage in formal cooperative arrangements. Our evidence shows that municipalities instead tend to bend the rules and maximize their autonomy when carrying out compulsory functions. Belgium provides a good example. Legislation stipulates that the lightest form of cooperation must be single-purpose or can only include closely related tasks. Municipalities have therefore established – on paper – separate single-purpose cooperative arrangements that, in reality, take place within one and the same de facto multi-purpose institution. In France, the principle of exclusivity – implying that once a function has been transferred to a joint authority a municipality no longer has the right to exercise it – has been hard to enforce. In the Netherlands, statutory obligations for metropoli-

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tan joint authorities to establish strategic plans for economic development, public housing, transport and infrastructure on occasion result in symbolic policies that leave the participating municipalities much room to manoeuvre. It seems that for statutory obligations concerning cooperation to be effective, supervision by upper level government is necessary. In some countries, like France, upper level government does not exercise administrative supervision; in others, like the Netherlands, regional governments have proved themselves lenient for the sake of good relations with local government.11 The second method, the use of financial incentives, seems more effective, at least when resources aim at the compensation of the costs of operation of the joint organisation as a whole or of the costs related to a specific function. Both Italy and the Netherlands provide examples of the success of grants attributed to foster cooperation. On the other hand, when financial resources function as a means to promote the joint planning and programming of local policies on social-economic development and related policy fields, it is not uncommon to find that cooperation is more symbolic than real. Both France and the Netherlands provide examples of the proportional disbursement of extra funds to participating municipalities according to their size, neglecting the imperative to formulate policies from a supra-municipal perspective or to allocate resources according to the differentiated needs of the partners. Considering the relative difficulties countries encounter promoting intermunicipal cooperation one may ask if no alternatives are available. Obviously, there are no objections against offering legal frameworks and financial support that enable municipalities to cooperate on a voluntary basis with respect to tasks that belong to the domain of local government. But if cooperative arrangements cease to be support structures for local government and are expected to operate as more or less independent entities, is the promotion of inter-municipal cooperation by central government but a mere excuse for avoiding more radical reorganisations of the administrative system? Of course, these questions are borne by a technical, rational view of administration. The political reality, where local autonomy is sometimes sacred and the balance of political power sometimes stands in the way of reinforcing intermediate levels of government, repeatedly proves to have the upper hand in the design of the administrative system. 5. Conclusion The inventory and comparative analysis of inter-municipal cooperation in eight European countries shows that it is a widespread phenomenon. It presents broad variety on a series of dimensions: composition, tasks, scope, degree of institutionalisation, decision-making powers and democratic legitimisation. The variety of cooperative arrangements notwithstanding, four basic types exist in almost all countries: semi-regional governments, service delivery organisations, service delivery agreements and planning forums. The analysis shows that the national institutional context to a large extent explains the presence of each of the types. Reviewing our inventory of cooperative arrangements in their respective national contexts, and the available data on performance, what can be said about their value and their future?

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First of all, we must note that cooperative arrangements are a supplement to the standing organisation of the national administrative system. They do not replace existing entities of public administration, but create more or less institutionalised links between these entities. According to basic organisation theory, supplements to a standing organisation are necessary to cope with interdependencies between different parts, which are not reflected in existing vertical and horizontal differentiation (Mintzberg 1979: 161 ff.). However, supplements – project teams, standing committees, task forces, integrating managers, linking pins, all implying coordination by mutual adjustment – do not come without extra costs. If supplementary organisation proliferates, it indicates the need for a revision of the existing organisation structure; it apparently does not integrate the dominant interdependencies. As we have seen, inter-municipal cooperation arises from the fact that the existing administrative system is not able to cope with rising functional interdependencies and interdependencies of scale. It is a rational strategy to address issues that have not taken a definite shape, issues of a temporal nature and issues that are subject to permanent change, because cooperative arrangements can be adapted relatively easily to changing circumstances. However, if cooperative arrangements proliferate, reach a higher degree of institutionalisation, and address standing issues on a regular basis, reorganisation of the administrative structure comes into the picture, or at least it should. Because, whatever the added value of cooperation, it comes with extra costs resulting from the establishment and management of cooperative institutions and is not without problems with respect to efficacy and democratic legitimisation, especially in the face of available alternatives: the amalgamation of small-scale local government, the attribution of tasks to intermediate level government and outsourcing service delivery to the private sector. Vertical cooperation on service delivery between municipalities and regional or central administration, which tends to hollow out local autonomy, is a poor substitute for up-scaling local government and genuine decentralisation. In the same way, semi-regional government, which as a rule struggles to effectively coordinate local policies, seems not nearly as effective as autonomous regional government. For some services, the private sector has proven substantially better than cooperating municipalities. However, evidence from several countries in our sample shows that the reorganisation of standing administrative structures generally meets with substantial resistance. The amalgamation of microscopic local government in France, Spain and Italy is politically taboo, as is the centralisation of service delivery to standing upper level government in many countries. In the UK, the new labour government has not been able to induce local government to establish directly elected regional governments, despite the evident need for an intermediate administrative level; in the Netherlands, efforts to replace semi-regional government by authentic metropolitan government have failed time and again. Only in some German metropolitan areas have new public authorities been established as an alternative for existing cooperative arrangements, albeit on a modest scale. On one hand, we expect that pressures to find functional equivalents will rise, not so much for the new policy networks and service agreements that try to cope with new interdependencies in dynamic environments, but for cooperative arrangements with a high degree of institutionalisation involved in regular service delivery

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and planning. On the other hand, in view of the viscosity of existing administrative structures, it is most likely that cooperative arrangements in the wide variety that we have found in the eight countries will survive and even flourish for many years to come. This justifies that we reflect briefly on an agenda for future research into different forms of inter-municipal cooperation. The aim of the book project was twofold. First, it meant to assess the presence and trends in inter-municipal cooperation in a series of European countries and to relate these to the features of the national institutional context. Second, it aimed to assess the performance of the different modalities of cooperation, and to relate performance to the institutional characteristics of cooperation itself. Reviewing the different country studies and the comparative analysis carried out in this last chapter, we can say that the first goal has been accomplished, at least up to a certain point. This is not the case with the second goal. Reliable data on the performance of the different forms of inter-municipal cooperation are scarce, and the research that has been done only allows for tentative conclusions about the relation between different forms of cooperation and performance. Therefore, it is not yet possible to make positive statements about the relation between the institutional design of cooperation and the quality and efficiency of service delivery, or the democratic quality of decisionmaking. This is not only unsatisfactory from a scientific point of view. It also leaves the practitioners involved in the establishment and management of cooperative |arrangements empty-handed. The conclusion therefore must be that research into the performance of inter-municipal cooperation and into the factors that determine its success and failure should be at the top of a future research agenda. References Airaksinen, J., & Haveri, A. (2003). Networks and Hierarchies in Inter-municipal Cooperation, Are Networks Really Light and Flexible and Hierarchies Sticky and Rigid? Paper presented at the European Group of Public Administration conference. Lisbon, September 2003. Font, J., & Parrado Díez , S. (2001). Eligiendo socios en la administración municipal española: Los consorcios y las mancomunidades. Cuadernos de Gobierno y de Administración, 3, Madrid: Universidad Rey Juan Carlos. Hepburn, N., LeSage, E., & McMillan, M. (2004). Shared service arrangements: Determinants of success. A study of economic development and recreation and culture. Shared service arrangements among municipalities of the Alberta capital region. Information Bulletin, Western Centre for Economic Research, University of Alberta, No. 78, June 2004, available at http://www.bus.ualberta.ca/wcer/pdf/78.pdf. Herweijer, M. (1998). Schaal en gemeente. In A.F.A. Korsten, & P.W. Tops (Eds.), Lokaal bestuur in Nederland, Inleiding in de gemeentekunde, 135-156. Samsom: Alphen aan den Rijn. Hulst, J.R. (2000). De bestuurlijke vormgeving van regionale beleidsvoering. Delft: Eburon. Mintzberg, H. (1979). The structuring of organizations. Englewood Cliffs: Prentice Hall. Thompson, J.D. (1967). Organisations in action. New York: McGraw-Hill. Torchia L. (1997). La conferenza dei servizi e l’accordo di programma ovvero della difficile transizione. Giornale di diritto amministrativo, 7.

Notes 1 Local government is represented in the governing boards of the Provincial Development Companies, the Gewestelijke ontwikkelingsmaatschappijen.

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This was the case in the Netherlands, where law forbade multi-purpose joint authorities until 1985 to prevent an upper level of local government between the municipalities and provinces from coming into existence. 3 In Thompson’s terminology, “when pooled or serial interdependencies occur” (Thompson 1967). 4 The statutes of the Mancomunidad de Municipios de Guadajoz and Campiña Este de Cordoba stipulate that the general council of the mancomunidad consists of three representatives of the participating municipalities for each 5000 inhabitants and that the local councils appoint the representatives from and in proportion to the political groups represented. 5 The council of the Comunità Montana Montagna Fiorentina consists of four, five or six representatives of each community (according to size), one (of a four- or five-member group) or two (of a six-member group) of which must come from minority parties. Statutes 23.04.2002. 6 This does not go for the semi-regional governments in the urban agglomerations. The statutes of the Amsterdam Regional Corporation stipulate that the local councils further the inter-municipal council’s reflection of the region’s balance of political power. On the other hand, when legislation made it possible to create regional constituencies, where the council members from all participating municipalities would choose their delegates from lists drawn up by the different political parties, they refused to do so, as this would cut the direct link between members of the inter-municipal council and the individual municipalities. 7 Statutes typically stipulate that members of the inter-municipal council inform the local council at its request, be responsible for their actions in the council and retire at the local council’s request. 8 Cf. chapter I, section 6. 9 Note the special cases of Berlin, Hamburg and Bremen, which are states and metropolitan municipalities at the same time. 10 In both countries there are or were a limited number of semi-regional governments with directly elected councils. 11 Provinces have allowed municipalities to create single-purpose joint authorities, although the 1985 Joint Provisions Act stipulates that cooperation must take place within one integrated organisation.