Local Authorities: Self-government sacrificed to liberalization
Zmicier Kuhley

Summary:

Local authorities in 2010 were working within the framework of two election campaigns. One of them, the April election to local councils, was directly related to the local representative power branch. The other, presidential elections, was of decisive character for the whole structure of the Belarusian regime in the short- and medium-term perspective. Both election campaigns tested Belarus' political system for stability. Local authorities are a constituent part of the "presidential vertical", with the executive branch dominating the representative one. They are in no way a separate self-government institution representing interests of the local community and protecting the latter from excessive interference from the state.

The new version of the law On local government and self-government that came into force on January 4, 2010 introduced no changes into the existing practice. Local authorities went on following the rules that had formed over the last 16 years. There is a kind of silent agreement between the president and local authorities: the incumbent country leader guarantees status quo and powers to local and regional elites; whereas Alexander Lukashenko’s further terms of office depend on local authorities. At the same time, controversial tendencies determined the development of local authorities: on the one hand, the subjective factors of the Belarusian authoritarian regime, on the other hand, the objective urge for economic modernization of the country.

Tendencies:

- On the one hand, the local elections in 2010 further isolated local authorities from the public and narrowed the competitive sphere for recruiting candidates for the ruling elite; on the other hand, up-to-date information and communication technologies (ICT) being introduced on all state levels, including local and regional, are contributing to more open and transparent work of local authorities;
- Local elections highlighted interest discrepancies between local elites and the incumbent country leader;
- Local authorities keep losing powers in business sphere regulation because of attempts to liberalize entrepreneurial activities;
- The consolidated budget of the Republic of Belarus is becoming more centralized; the ratio of non-repayable receipts from the national budget to local ones is growing;
- Local executive bodies expand their powers for controlling local communities.

 Maintaining tradition, steering clear of innovation

The two electoral campaigns of 2010 directed the state policy in local government and self-government to following the principle of "maintaining tradition, steering clear of innovation". In 2010, Lukashenko's 2006 thesis voiced after the third presidential election was still topical: "the power vertical must be kept firm from top to bottom; no practicing democracy".

Since January 4, 2010 local authorities have been following the new version of the law On local government and self-government in the Republic of Belarus. The law introduced no decisive changes into the Belarusian system of local government and self-government. It simply redistributed powers between local councils of deputies and regional executive bodies that used to be duplicated at regional and district levels.

The law also defines the legal status of and the procedure for establishing territorial public self-government bodies. We should note that before the presidential campaign of 2010 the local ideological apparatus grew more active. It focused on establishing territorial public self-government bodies that were to cooperate with local authorities to solve local problems by joined efforts of citizens and executive bodies. Nevertheless, the initiative became purely formal, turning into a propaganda tool.

Article 59 of the law On local government and self-government now contains a note that local councils can initiate legal procedures to protect their infringed or disputed rights and interests to execute their powers. In 2010, not a single case was registered. This legal norm enables councils to protect their rights against executive and national power bodies. Nevertheless, in the over-centralized Belarusian state system local self-government is absolutely dependent and answerable to the "presidential vertical". No lawsuits can be expected between these subjects. The Belarusian political elite is haunted by the idea expressed by the state leader that local councils are no bosses on their territories, they simply share responsibility with local executive bodies.

The new version of the law On local government and self-government empowered Belarusian authorities to establish local councils associations to lobby their interests at the European level. The latter have a right for international cooperation. It is worth mentioning that the European Union pays much attention to regions and local community development, including border areas of neighboring states, and allocates significant sums from its budget. Projects involving European partners and local authorities, including Euroregions, are already functioning in Belarus. Nevertheless, Belarusian local authorities do not cooperate with European municipalities to their fullest extent, unlike other EU partners. Immediately after the local elections, Belarusian authorities launched activities to establish the Belarusian Association of local self-government bodies, which was not completed until the end of 2010.

Local elections 2010: controversies between the centre and local elites

After the local elections in April 2010, local and regional elites kept isolating themselves from the public: few oppositional parties’ representatives made it to local councils of deputies.

Despite that local councils’ deputies have limited powers, they can partially control governing bodies, e.g. on issues of financial flows and budgetary distributions at the local level. We should note that local functionaries got used to controlling the way in which local representative bodies are formed. They are used to being unaccountable to local communities, whose interests they are actually to represent. In reality, local political elites are accountable directly to the president in implementing national policy on the entrusted territories: to ensure good social and economic performance and stability in the region, including the required number of Alexander Lukashenko’s supporters among the local population. The president, in his turn, secures that there is a favorable recruitment policy and no unwanted business competition at the local level. The situation is mutually advantageous: the incumbent state leader does not wish his rivals to strengthen their positions in local governing bodies, whereas local political elites do not allow "aliens" into their system, so that their interests are secured.

Nevertheless, in 2010 relations between the president and local authorities faced new challenges. The number of opposition representatives in local self-government bodies long ago fell below the critical level to present any threat for the president. In 2010 Belarusian officials kept working towards improving relations with Western partners, which required making some concessions. Several dozen oppositional deputies of local councils would have presented no danger for the present Belarusian regime but would have evoked positive reaction from foreign partners, which could have been translated into financial and economic preferences from the West.

Despite that the Central Election Commission and top authorities’ strongly wished to show foreign observers some progress in the election procedure, local and regional functionaries would follow the 16-year old campaign scenario and left local councils without oppositional deputies. Nevertheless, the inaction and unwillingness to accept the new political reality had little influence on Belarus-West relations, as the latter placed all their hopes in the presidential campaign.

Local authorities were traditionally criticized by the country's administration, especially before the presidential election. Belarusian propagandists tried to convince the public that local governing bodies are to blame for the drawbacks and failures in the social and economic sphere, while the top administration keeps working effectively and controlling all government levels, being also capable of solving problems in the competence of local authorities. This way of presenting the work of local authorities, besides being purely propagandistic, further convinced the public that highly centralized public administration is necessary in the state.

Liberalization causing centralization

In 2010, the consolidated national budget became even more centralized: local budgets lost the retail sales tax and local duty on parking users. In 2010 local budgets totaled BYR 18.7 trillion, with transfers from the national to regional and Minsk budgets reaching BYR 7.3 trillion, or 39% of all local budgets expenditures. Local budgetary receipts decreased because of the new methods to calculate land tax by cadastral value of land lots. At the same time, in the first quarter of 2010 local councils of deputies were not empowered to apply multiplying factors to the real-estate tax rate. What is more, according to the National comprehensive program for regional and small and medium urban settlements development in 2007-2010, local councils of deputies continued granting privileges or delays for enterprises in paying debts, local taxes and duties, contributing to smaller local budgetary receipts. We should note that for the last few years local and regional authorities have been losing their financial independence due to reduction of local taxes and duties to their minimum.

Local authorities play an important role in the Belarusian licensing system in business. Decree No. 450 On licensing certain activities as of September 1, 2010 stripped them of a significant number of powers through abolition of licenses to perform 16 entrepreneurial activities. This decree eliminated local barriers for small and medium business. The most important was abolition of licenses for retail sales that used to make up 156,000 of a total 240,000 licenses. Independent experts and businesspersons regarded local authorities as a hindrance for small and medium business development. At the same time, decree No. 581 On purchase of real estate for local needs as of November 9, 2010 empowered local authorities with extra mechanisms to influence the real estate market and, respectively, small and medium business development on the entrusted territories.

It should be mentioned that liberalization of entrepreneurial activity is carried out at the cost of local authorities: their powers and financial independence is reduced. The tax burden on business is being reduced at the cost of abolishing local taxes and duties; the business climate is being improved by abolishing licenses that used to be issued by local administrations and executive councils.

Nevertheless, positive changes of economy liberalization were partially impaired in early 2010: decree No. 518 On certain issues of rentals and non-repayable use of property enables local authorities and state enterprises to apply multiplying or reduction factors when providing rentals. Local functionaries took it as a cart blanche to apply the highest multiplying factor and increase budgetary receipts. Eventually, the president intervened and granted the State Control Committee powers to audit local authorities and state enterprises on legal grounds for raising rentals.

Local executive and administrative bodies were empowered to directly intervene in activities of condominiums and influence the procedure of electing the chairpersons of these non-profit organizations. In late 2010 the president signed a decree On certain issues of condominiums and estate developers that expands local functionaries’ powers on non-profit organizations. The decree expands control functions of local executive councils to condominiums and estate developing organizations. Local executives now have a right to endorse candidates for chairperson of the board, to nominate candidates, to initiate early dismissal, etc.

The country's administration is attempting to optimize activities and increase efficiency of state bodies. In 2010, a pilot automated information system (AIS) "Local councils of deputies" was launched in Bieladubrauski (Kasciukovicki district) and Janauski (Krasnapolski district) village councils. AISs promote effective and open work of local authorities. AISs save time, provide access to legal information, including lists of administrative procedures. They are expected to promote small and medium business in regions. In 2011, AISs are to be introduced in all local councils of deputies of Belarus.

On December 11, 2009 Alexander Lukashenko signed decree No. 622 On improvement of land regulations and state control over use and protection of land, which transfers land management functions to local authorities. Land management and geodetic functions of the State Property Committee are transferred to local executive councils with maintenance of the total number of civil servants.

Conclusion

Local government and self-government in Belarus is "built-in" into the "presidential power vertical". Being its inseparable element, it continues to perform its function of maintaining stability of the Belarusian regime. The country's top leader is afraid to lose power if the present state system, having been developed over the last 16 years, is reformed, which hinders reforms of local authorities, despite that the situation is calling for change.

State authorities are taking certain actions to improve local authorities’ work, especially in business, but this produces controversial tendencies. The Belarusian authorities are liberalizing economic activities at the cost of local authorities: their financial dependence is growing, the consolidated national budget is further centralized as local budgetary receipts are reducing. On the other hand, reduced local budgets demand more non-repayable receipts from the national budget, causing parasitical attitudes in and demotivating local authorities to create a good business environment on the entrusted territories. Also, local functionaries are afraid to lose their non-official rents or positions and oppose liberalization of entrepreneurial activities at the cost of reducing bureaucratic establishment's powers in business sphere regulation.