Distinguished panellists, participants, colleagues and friends,

Let me start by wishing all of you a warm welcome to Norway. It a great pleasure for me to open this workshop, which has been organized by the Norwegian Institute for Urban and Regional Research, in collaboration with the DAC Working Party on Aid Evaluation and the DAC Network on Good Governance and Capacity Development. I understand that the workshop is part of what might be called a "brainstorming process" before the report is finalized and submitted to the OECD/DAC.

This workshop and the substance it will cover are something we attach great importance to in our development cooperation policies. The processes of decentralization and improvement of local government are part and parcel of the good governance issue. The significance of good governance for development is well documented. The quality of a country’s governance determines how a society’s assets are put to use for the benefit of the people. It also determines what possibility people have to exercise their rights in their day-to-day interactions with the authorities at the national and the local level, as well as with their fellow citizens.

In societies where public institutions function poorly or arbitrarily, where laws are unclear and legal protection weak, the poor often have difficulty in gaining access to health services and education, and in exercising other rights they are entitled to. Moreover, the combination of centralized decision-making authority and weak local authorities creates a distance between the population and the decision-makers. It makes it more difficult for people, especially the poor and the least privileged, to fight for their rights and take control over their own lives. Good governance and public policies built on democratic values are fundamental prerequisites for poverty eradication.

Local democracy and decentralization was also the theme of the very interesting Bergen Seminar on Development, which took place in June last year. It focused on democratization and conflict prevention. The session on local democracy illustrated the basic problem of centralized decision making powers and weak local authorities. On the basis of experience gained in Tanzania, it was pointed out that decentralization may be a long process that entails changing deeply rooted practices and traditions. Decentralization could be impeded by the sheer reluctance of central government ministries to devolve powers, responsibilities and resources to local government authorities.

Common excuses cited for the failure to decentralize are lack of resources and inadequate capacities at the local level. It is also a problem that local government authorities tend to be more loyal and accountable to the central leadership than to their own electorate. Consequently, there is a tendency at both levels to pay more attention to the preferences of national authorities than to the needs and necessities of local citizens. This may raise important questions and even concern about the inability of local and central government alike to understand problems at the grassroots level. If they don’t have an understanding of these problems, they will not take account of the concerns of the general population in their political agendas. Further progress may depend on joint efforts to address capacity building and establish a more equitable system for distributing revenues between central and local government. It may also depend on making electoral systems more democratic, for instance by ensuring that candidates are dependent on local constituency support to win elections.

In this address I will not dwell on the content and findings in the draft report of the Norwegian Institute for Urban and Regional Research. However, I would like to say a few words about the lessons learned and comment on one of the recommendations.

One of the lessons learned is that central government commitment is a precondition for effective external support for decentralization and local governance efforts.

The significance of this lesson cannot be overstated. This echoes one of the most important principles of development cooperation: recipient responsibility. Norway has for a long time claimed that only the national authorities can control their own development process. They have to be "in the driving seat". If our partner governments wish to cooperate with us on local governance, they must put in place decentralization policies and legal frameworks that determine the powers and functions of sub-national structures. The partner governments must also clearly define the functional limits of the autonomy of these structures. In short, they must demonstrate commitment and responsibility.

I would also like to comment briefly on one of the main recommendations, which is that "poverty focus needs to be strengthened". This is listed as the third recommendation. If the recommendations were set up in order of priority, I would put this one at the top. At the UN Millennium Assembly the world agreed on a global agenda: the Millennium Development Goals. The first goal is that the share of people living in extreme poverty should be halved by 2015. For Norway, poverty alleviation has been, and still is the overriding goal in our development cooperation. In the poorest countries the majority of the poor live in rural areas where up to 90 per cent of the population are agricultural producers or peasants. Thus, a decentralization programme that does not target the poor cannot be called a success. Decentralization policies must be pro-poor!

I wish you all the best in your deliberations at this important workshop. I am looking forward to the report and your recommendations for the way forward.