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Corruption is high on the agenda of national governments, international organisations, aid providers and civil society. At the same time, decentralisation has become a dominant policy reform across the developing world, within a context of democratisation and expectations that ‘democratic decentralisation’ would bring government closer to the people, increase accountability and help to combat corruption. However, research on decentralisation shows it has a mixed record in the real world, and corruption research and policy-making increasingly recognises the need to disaggregate corruption – corruption takes many different forms and has different causes and effects in different settings, and strategies to combat corruption are also likely vary across these types and settings. As a result, the links between decentralisation and corruption are complex, and the role of decentralised governance in combatting corruption remains unclear.

This report aims to deepen understandings of the links between decentralised governance and corruption, and the implications of such linkages and dynamics for the effectiveness of anti-corruption measures at the local level. It synthesises the findings from two indepth case studies on decentralised governance and corruption in Bangladesh and Nigeria. These case studies can be accessed here. 

The report concludes with a number of important recommendations to support more effective anti-corruption efforts:

• Anti-corruption efforts need to be grounded in an approach that combines principal-agent, collective action, and social norm-based understandings of corruption.
• Structural reforms and anti-corruption efforts should pay closer attention to the need to build the coherence of government arrangements across different levels and political, administrative and fiscal dimensions of governance. Among other things, this entails supporting reforms that:
  • Improve the clarity of fiscal powers and the alignment of fiscal decentralisation with functions and accountabilities. Concrete steps include ensuring grant mechanisms are implemented as intended and are free from procedural interference, revenue powers are well regulated, and participatory budgeting is reflected in budget outcomes.
  • Clarify the degree and form of political autonomy to create clear local accountabilities. Devolution with authority, or clearer accountabilities in deconcentrated models, can support more autonomous local politics, and enablers such as more independent electoral administrations and autonomous local participatory bodies can provide a supportive environment.
• Direct approaches to corruption – such as anti-corruption agencies – need to fund and empower local offices of those agencies to perform appropriate actions locally with the independence required. As a default or residual approach, awareness raising will have limited impact.
• Indirect, legal or regulatory approaches may not require additional formal law, policy or regulation. In fact, simplification and clarification of these measures may be more appropriate.