Allocation of specific grant for local authorities in Chonburi
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2021
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2564
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This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
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Wittaya Chaojaroenrat (2021). Allocation of specific grant for local authorities in Chonburi. Retrieved from: https://repository.nida.ac.th/handle/662723737/5684.
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Allocation of specific grant for local authorities in Chonburi
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Abstract
This research aimed to study the policy on the allocation of specific grants to local government organizations (LGOs) from two major funding sources, which are government-specific grants and the grants from provincial administrative organizations (PAOs) in relation to the political changes. The study has two main objectives: 1) to study the government's specific grant allocation policies to LGOs since the beginning of decentralization from 2001-2018 that affect local fiscal independence and to analyze the fiscal disparity that occurred among municipalities and subdistrict administrative organizations (SAOs) of Chonburi Province during the years 2010-2017, which covered the periods of 3 governments, in comparison with other grants in the same structure, as well as collecting problems and policy proposals to improve the allocation of specific grants and promote fiscal independence based on the principle of fairness among lower-tier LGOs within the province; and 2) to study the grant allocation policies of Chonburi PAO and to analyze the fiscal disparity among the municipalities and SAOs in Chonburi Province by comparing Chonburi PAO, which had not changed its chief executive, with other two PAOs, which had changed their chief executives in the latest local elections, between 2009 and 2017, as well as collecting problems and policy proposals to improve the allocation of the grants and promote the fiscal independence based on the principle of fairness among supported local authorities in the province.
This research utilized the mixed method research methodology. It applied qualitative research methodology to analyze the secondary data of the grant allocation by the government and PAOs. The population of the study in part of the government’s grant allocation included 7,848 LGOs across Thailand and 98 LGOs in Chonburi Province, which consists of 47 municipalities and 50 SAOs. Meanwhile, the population of the study in part of PAO grant allocation is the local authorities under 3 PAOs, namely Chonburi, Sukhothai and Songkhla, consisting of 98, 90 and 140 local authorities, respectively. The research conducted the qualitative research by interviewing 9 experts and local chief executives with the semi-structured interview methodology. The results of this study consisted of 2 parts as follows:
Part 1: The allocation of government specific grants: The research found that the grant allocation policies were fluctuated with political changes. Most governments preferred to maintain the authority-related general grants. On the contrary, the specific grants varied inversely with purposive general grants; there were switches of missions between the two grants as well. It reflected the degree of political role in governing grant allocation policies which affected Chonburi localities. There, wealthy municipalities received more money than the poor ones, whereas the situation of Subdistrict Administrative Organizations (SAOs) was on the opposite. Furthermore, the disparity from all types of grants among municipalities was higher than that of SAOs, especially, the disparity from the specific grants because many localities did not receive support. There were several problems in allocating specific grants, such as the lack of clear criteria, unpredictable grant approval, and inconsistency with local needs. The suggestion is to reduce the proportion of the specific grants, spend it when necessary, develop low-valued projects that can be widely distributed to localities, increase the share of authority-related general grants, and provide external budgets for government programs.
Part 2: The allocation of Chonburi PAO grants: The research found that the policies of grant allocations to other receiving grant supported units, which isare under the PAO chief executive's independent mandate, was were highly variable with the individual.fluctuated between the chief executives. The fiscal disparity of grant allocation to LGOs can occur in two levels: 1) the disparity among the three types of receiving grant unitsagencies receiving the support, namely the GLOsLGOs, government agencies and public benefit activities,enterprises, and 2) the disparity among lower-tier LGOs, which are municipalities and SAOs. Chonburi PAO had a very high proportion of grants to the annual expenditure budget. The proportion of fiscal disparity among the three types of supported units was close, while the disparity between lower-tier LGOs were remarkably high. From the comparison of the grant allocation between Chonburi, Sukhothai, and Songkhla PAOs, the research found that the latter two PAOs were alike: Their policies were extremely uncertain, and both places had high degree of fiscal disparity at the two levels of grant allocation. In addition, they paid attention to local authorities less than Chonburi PAO. The major problem was that in some years there was little financial support to no support at all to the LGOs. As a result, local authorities were not an important factor for PAO chief executives in considering whether to provide financial supports. In addition, the grant allocation policies did not correlate with the year before and after the local elections. To reduce this fiscal disparity, a framework of grant allocation among the three entities may need to be established by setting the minimum proportion the LGOs will receive as the guarantee of their revenue. The PAO thus should be careful in supporting any projects that are inconsistent with their legal missions, arranging the priority list of supported projects as needed, and thoroughly circulating its budget to all local authorities.
Keywords: Government Specific Grant Allocation, Local Government Organizations, Provincial Administrative Organizations, Fiscal Disparity, Chonburi Province
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Thesis (D.P.A.)--National Institute of Development Administration, 2021