Only six months into her tenure, and centre-left leaning City Mayor Anne Hidalgo had already set aside a generous €426m budget for the people of Paris to do with what they will. “This is a new tool for citizen participation for all Parisians to propose and choose the projects that will make the Paris of tomorrow”, she said. “They will have the opportunity to be full participants in civic life. I see a major democratic innovation.”
Christened the ‘Budget Participatif’, the initiative is set to run through 2020 and will leave Parisians to decide on which projects five percent of city hall’s budget will be spent. Kicking off on 24 September and closing 1 October, citizens were offered a choice of 15 projects for the first round, with the list spanning everything from pop-up swimming pools to living walls. And whereas participatory budgeting, on one hand, marks a major departure from what’s come before, the model follows a string of projects like it, similar in scale and in ambition, and all united by an ambition to improve public policy.
Allowing citizens a say in the allocation of public spending is an effective tool for ensuring services align with people’s best interests
This being said, participatory budgeting represents only one facet of a much wider discussion on participatory devices and the role they play in improving – and even transforming – public policy. In principle, a participatory budget (PB) could see underrepresented minorities wrestle control away from ill-informed authorities and allocate finances to areas desperately in need of stimulus. Ultimately, democratising the budgetary process could mark a turning point for governments looking to more effectively allocate their finances and gather public support. However, the system is not without its faults, and the results can sometimes miss the mark, with many participants prioritising immediate ‘human’ concerns ahead of economic ones.
Making a compromise
In the case of Paris, the winning bid was a $3.69m scheme to improve biodiversity across the capital by creating living walls, in keeping with a socially responsible theme shared between the nine winning projects. In second place was a plan to create so-called ‘learning gardens’ in schools, and plans to create more recreational space and recycling points also gained widespread support. And while the majority were bowled over by the scheme, others were unconvinced by a PB, so soon after reports at the midpoint of 2014 showed the city’s budget deficit stood at a mammoth $492m.
Sure, the chosen projects might not coincide with the priorities set out by the government, though allowing citizens a say in the allocation of public spending is an effective tool for ensuring services align with people’s best interests. In short, participatory budgeting is a proven method of democratising spending decisions and improving the relationship between citizen and state. Opinions on the initiative are split and studies on its supposed effectiveness number in the many. Though the mechanism has been gaining traction most notably since the 2008 financial crash, with inspired authorities to turn to innovative and even untested means of improving public spending to offset any losses.
“This challenge demands innovation. With fewer resources, public services need to look for new ways of supporting people. Innovation, in turn, demands participation”, according to a Nesta report entitled Unlocking the Potential of Participatory Budgeting. “We need to build on the vibrant and growing movement of direct involvement of people and communities in their public services that complements the strategic leadership already provided by our elected leaders.”
Prior participatory budgeting
Driven by extreme lengths of poverty and widespread homelessness in the country’s southernmost state, authorities in Brazil’s Porto Alegre in 1989 were the first to pioneer the participatory budgeting process. It was here that a PB came to be seen as a viable solution to the city’s prevailing socio-economic challenges, and it wasn’t long after that the initiative succeeded in paving the way for a long list of public welfare improvements.
However, the first known trial of PB was also the first time policymakers were alerted to the difficulties contained within, with fears abound that under representation could distort the system’s effectiveness. Although the initiative was born of a call for greater inclusion, only 1,000 voters turned out for the first round of signatures, and while 40,000 would sign before the decade was up, there was a danger from the outset that the demands of only a small segment of society would be represented. Therefore, half the challenge – and a large part of the solution – for those introducing a PB is in reaching peripheral communities and sectors of society that might otherwise be overlooked.
Even assuming that the message makes it to every citizen, there is still a danger that some might misinterpret what benefits they could stand to gain – if any. The challenge of explaining the intricacies of public finance to the masses is a complicated business, not to mention the logistical challenges of reaching them in the first place.
Without a transparent method of translating relevant points to a mass audience, it’s unlikely that any voters will be in a position to make a qualified decision about how best to distribute spending. For example, one report compiled by the Civic Institute shows that only one in every 10 Polish citizen’s budgets contained enough information to make it easily understandable and even legally binding. “Most budgets were poorly prepared. There were no public consultations held to explain the idea of participation to residents”, said the organisation’s director, Jarosław Makowski.
It’s clear that there are numerous challenges to first contend with before any government or institution can implement the system to any great effect, though reception to the idea among the public so far has been overwhelmingly positive. “People are experts on their lived experiences. PB is about more than giving residents a voice; it’s about bringing the community together in conversation. The community is able to collaboratively identify needs, create solutions, and prioritise their options”, says Josh Lerner, Executive Director of the Participatory Budgeting Project.
“Residents have invaluable local knowledge about needs and priorities in their community. PB combines this local knowledge with technical knowledge from experts, to make public spending more efficient and more responsive to community needs”, adds Lerner. “When a community decides how and where to spend money, it makes the community stronger through the shared experience of working together to solve problems and implement solutions”.
Seeing all the facts
Even still, the growing adoption of participatory budgeting represents just one part of a growing trend towards decentralisation in developing nations, especially in regions where democracy itself marks a relatively recent development. “By giving voice to those generally excluded from the democratic debate, PB has been shown time and again to have positive ‘pro-poor’ benefits”, says Sue Ritchie, Acting Chair of the UK PB Network.
“Transparency is the key to good government, and across the world PB has been linked to the reduction of corruption in the awarding of public contracts, and has stimulated community based enterprises; thereby returning income to communities through local employment and better public spending.”
At present, there are over 1,500 cities and institutions implementing a PB of some description, many of them in developing markets where large sectors of society are underrepresented by government. In these areas, participatory budgeting represents a welcome departure from the poor governance controls that have for too long dogged citizens, and promises to boost investment in areas most in need of improvement.
“Participatory budgeting is emerging as an innovative urban management practice with excellent potential to promote principles of good urban governance”, according to a UN-Habitat report entitled Participatory Budgeting in Africa. “Indeed, participatory budgeting can yield many benefits to local government and civil society alike. It can improve transparency in municipal expenditures and stimulate citizens’ involvement in decision-making over public resources. It can redirect municipal investment toward basic infrastructure for poorer neighbourhoods. It can strengthen social networks and help mediate differences between elected leaders and civil society groups.”
The benefits of the system however, are far from excluded to emerging markets, and some of the world’s biggest economies are actually among the leading practitioners of the system. New York City, for example, is home to the largest PB in the country, and between September 2014 and April 2015, citizens in participating districts will cast their votes on how close to $25m of the public budget will be spent. The mere fact that the system has made its way to such a major city is proof that participatory budgeting is not just a means of eradicating poverty and giving poorer citizens a voice, but represents a genuine alternative to traditional public spending.
“PB helps communities spend money more efficiently, builds local leadership, and connects communities to the process of governance, resulting in deeper civic participation”, says Lerner. “More than 25 years of research on PB from around the world show that governments who value civic engagement and democracy should try PB.”
Supporters have been quick to flag the benefits a PB can bring for citizens, and claim that the model improves governance, empowers those in the community and builds solidarity. However, the advantages for practising governments and institutions are arguably even greater, in that participatory budgeting can build the legitimacy of public policy and build trust between citizens and state. Whether it is in Porto Alegre, Paris or even New York City, participatory budgeting has been introduced against a variety of different backdrops, with sometimes opposing ideologies.
Yet, no matter the circumstances under which the model is introduced and the exact form the system takes, the underlying objectives remain the same. In simple terms, a PB is an attractive prospect to any citizen or government with an ambition to improve governance and democratise decision-making.
Perhaps then, the most important point to be taken from public budgeting is not its effectiveness in driving projects most in need of finance, but in building the relationships shared between citizen and institutions. By looking at participatory budgeting as an important lesson in how governments and institutions can democratise spending decisions and align their goals with citizens, the model could feasibly represent a turning point for conventional public policy.
