Local government modernization in Albania. Historical background and the territorial reform 2015-2020

• Published date: 14 May 2018
• DOI: https://doi.org/10.1108/IJPSM-01-2017-0018
• Pages: 466-506
• Date: 14 May 2018
• Author: Elona Guga
• Subject Matter: Public policy & environmental management,Politics,Public adminstration & management

Local government modernization

in Albania

Historical background and the territorial

reform 2015-2020

Elona Guga

Department of Management and Law, University of Rome Tor Vergata,

Rome, Italy

Abstract

Purpose –An attempt will be made to shed light on the course and pattern of the decentralization process by

analyzing the historical development of local government and the territorial-administrative reform of

2015-2020 in Albania and the factors that have been shaping it. The scope is to understand the impact of the

reform elements on the subnational governments and in general their overall impact on the government.

The purpose of this paper is to fill the gap in the existing literature for Albania and at offering some insights

on the administrative-territorial reform. Furthermore, it will contribute to the current debate on fiscal

decentralization in South Eastern European (SEE) countries and the public management model implemented

after the last reforms.

Design/methodology/approach –The first section analyzes the historical development of local

government reforms from the 1990s to today and will help to identify if there is instrumentalism advocacy.

The second section explains the determinants of the local government’s fiscal autonomy in Albania of the

period from 2003 to 2016. Three indicators are used as proxies for fiscal decentralization: the proportion of

subnational expenditure over national expenditure, of total subnational revenues over total revenues

of central government and the indicator of own subnational revenues over total revenues of the central

government. The data from the budget and the revised budgets are then compared.

Findings –Despite Albania’s commitment to decentralize its government functions, there is still work to do.

The territorial and administrative reform has not generated the expected results. Almost 90 percent of the

revenues still come from the central government’s unconditional transfers. Therefore, the Albanian

Government should build capacities and skills, and train the employees of each level of government that

currently benefit from international assistance.

Research limitations/implications –The analysis represents a single case study on the

territorial-administrativereform in Albania. Its implementationstarted in 2015 and it is probably too early to

discuss outcomes. However, it might be useful to analyze the first results after a two-and-a-half-yearperiod of

implementationof reforms. Despite contributing to the existinggap in the literature, additionalresearch will be

necessary to better understandthe decentralization processnot only in Albania, but in all SEEcountries.

Practical implications –It is necessary to first understand the lack of initial output, as well as the various

challenges faced, in order to take the corrective measures on time.

Originality/value –This paper discusses in d etail the reform adopt ed and the progress made b y the

Albanian local govern ment units. The reform attempts to develo p better relationships between the cent ral

and local government s and hence improve their s ervice delivery, tra nsparency and account ability.

This paper is the first on e that is attempting to analyze the initial o utput of the territorial-administrativ e

reform of 2015-2020.

Keywords Decentralization, Albania, Local autonomy, Territorial reform

Paper type Research paper

1. Introduction

As evidenced by other scholars, since the fall of Communism in 1991, Albania has applied

its first governmental reforms. These reforms have been focused on the whole public sector

and institutional building, driven by the ideology of New Weberianism (New Weberian State

(NWS)), rather than by a proper management of the public sector (Stillo et al., 2011).

Recently, the intent of the European Union (EU) accession has shaped attitudes toward

fiscal decentralization reforms as a reaction to the planned system of the old regime.

However, over the years, only few reforms were aimed at making a real effort toward

International Journal of Public

Sector Management

Vol. 31 No. 4, 2018

pp. 466-506

© Emerald PublishingLimited

0951-3558

DOI 10.1108/IJPSM-01-2017-0018

Received 9 January 2017

Revised 20 May 2017

6 August 2017

16 September 2017

21 October 2017

Accepted 21 October 2017

The current issue and full text archive of this journal is available on Emerald Insight at:

www.emeraldinsight.com/0951-3558.htm

466

IJPSM

31,4

institutional building and the decentralization of the local governments. Until now, the

central government has kept tight control of fiscal reforms, and local governments have

relied heavily on unconditional and conditional transfers. The new territorial and

administrative reform of 2015-2020 aims to increase the efficiency of local public services

and strengthen the power of local government units. The aim of this paper is to understand

the first output of the reform. It will determine whether the decentralization process is

successful and will offer an important contribution to the literature on the public

management model.

The first territorial changes were introduced in 1992 by the Law No. 7572 “On the

Organization and the Functions of the Local Government”where local governments were

defined as the basic level of the Albanian Government. During the period 1992-2000 several

partial changes to the administrative-territorial organization took place, but without any

major structural change. During the same period, the existing legislation was completed

through secondary regulations that created the Department of Public Administration

(DoPA) and the Civil Service Commission. The new territorial and administrative reform

2015-2020 was determined by the Constitution of the Republic of Albania, the European

Charter of Local Autonomy and the recommendations of the European Council. It aims to

consolidate small local government units into larger and more efficient units capable of

providing greater access and delivering adequate and high-quality public services.

However, the dynamics of the ongoing local government modernization are being

implemented under the heading of the NWS (New Weberianism), which makes it difficult

to properly implement these reforms. The Government of Albania has published the

Public Administration Reform (PAR) Strategy 2015-2020 that is mainly focused on

reinforcing the central government.

Albania is a country that is facing several forms of economic, political and fiscal stress.

It has high levels of corruption and poverty, and low levels of accountability, transparency,

skills and capabilities. In addition, the political “fight”between the two main political parties

is intense and they rarely reach a consensus on common issues. Furthermore, one of the

greatest concerns of Albania is the high politicization of public services and the political

interference of the political parties in power. Adequate resources are required to implement

training plans for the staff in new municipalities. Historically, the central government

interferes in the affairs of local government by dictating how and where to use their

financial resources, thus violating the self-governance and the autonomy of the local

authorities (Pajollari and Özcan, 2017).

The paper argues that the efforts to reinforce the central government through the

improvement of legal framework, and procedures for drafting of policies, strategies, action

plans and legislation, as well as on building the capacity involved in these procedures,

will impede a successful implementation of the decentralization process.

2. Development process and methodology

Despite the plethora of articles analyzing the development and the role of local

governments in developed countries (Wollmann, 2000; Alba and Navarro, 2011; Bulkeley

and Kern, 2006; Cole, 2012; Mäeltsemees, 2012; Schefold, 2012; Vandelli, 2012; and many

others), few papers have analyzed the decentralization process in Albania and the

territorial-administrative reform of 2015-2020. Reçi and Ymeri (2016) analyzed the

designing process of the new territorial map. Kryeziu (2016) compared the Albanian

Constitution with the Constitution of other South Eastern European (SEE) countries.

Sherifi (2016) represented a historical background of the local governments of Albania

starting from the Ottoman Empire period until 1992. Ndreu (2016a) analyzed the

legislation related to the local government in Albania. Furthermore, Pajollari and Özcan

(2017) analyzed the relationship between the central and local governments in Albania.

467

Local

government

modernization

in Albania

However, none of these articles has tried to analyze the first output achieved after the

implementation of the territorial-administrativereforms.Thisisthefirstattemptto

empirically evidence the initial impacts of the territorial reform in Albania. Besides, it aims

to contribute to the existing literature on decentralization in two ways. First, it identifies

problems and issues that are hindering the smooth implementation of the 2015-2020

territorial-administrative reform. Second, it provides new empirical evidence on the

mechanisms linking PARs in Albania with the NWS model.

In this paper, an attempt will be made to shed some light on the course and pattern of the

decentralization process by analyzing the territorial and administrative reform 2015-2020 in

Albania and the factors that have been shaping it. The paper is a single case study analysis

providing information and financial data on the territorial-administrative reform in Albania

over the past two and a half decades. It aims to fill the gap in the existing literature for

Albania and to offer some insights on the territorial-administrative reform (decentralization)

and regarding the current debate on fiscal decentralization, not only in Albania, but also in

other SEE countries (Figure 1).

Decentralization may arise from different factors like local, economic, political and

ideological preferences that may lead to the transfer of power and resources from one level

of government to another (Schakel, 2010). The administrative-territorial reform is the focus

of this analysis. Thus, the decentralization process will be the starting point of this study.

Before analyzing the development of the territorial-administrative reform in Albania,

the paper will start with the literature review on the decentralization process (Box 1).

Recently, one of the most discussed topics is fiscal decentralization, which aims to increase

the autonomy of local governments and promote high-quality public services. The selected

papers are focused on the decentralization process as a whole, as opposed to specific topics

like health, education, welfare or other public services.

In order to link the literature on decentralization with the territorial-administrative

reform in Albania, the analysis will continue with the historical institutionalism approach

(Box 2). Historical institutionalism analyzes institutional formation and change, and

organizational configurations (Steinmo et al., 1992; Thelen, 1999; Pierson and Skocpol, 2002;

Sanders, 2006; Steinmo, 2008). Arguments related to historical institutionalism approach

involve the relationship between path dependency and development (Capoccia and

Kelemen, 2007). Criticism associated with historical institutionalism revolves around its

incapability to cope with change (Peters et al., 2005; Sanders, 2006). Despite that it is still

useful to note its importance in the present research work as it offers first insights into

institutional genesis and their evolution in Albania.

This approach will be explained through basic features of the Albanian legislation and

institutional development at the local level. Both of them are included as basic indicators

4. International

Assistance

3. Country Context

7. New Weberianism

approach

2. Historical

Institutionalism approach

2.1 Albanian Legislation

1990-2015

2.2 Albanian Institutions’

Development 1990-2015

8. Implementation of

territorial-administrative reform 2015-2020

6. Public Data Collection

(planned and revised

budgets during the period

2003-2015)

5. PAR 2015-2020

C-S Strategy of

Decentralization 2015-2020

5.2 Territorial

Administrative Reform

2015-2020

5.1 Strengthening the

Central PA

1. Decentralization

Process

Figure 1.

Conceptual framework

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