Investing Together

Working Effectively across Levels of Government

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Why 'investing together'? Public investment is not only a major strategic responsibility for governments but also a shared one: almost two-thirds of public investment is undertaken by sub-national governments and major projects tend to involve more than one government level. In a tight fiscal landscape, improving the efficiency and effectiveness of investment, while maximising its impact on growth outcomes, is paramount. Identifying and addressing the governance bottlenecks that impede smooth co-ordination across levels of government can make a significant contribution towards reaching that end.

This report dissects the relationships different government actors form vertically, across levels of government, and also horizontally, across both sectors and jurisdictions. It helps policy makers to understand more systematically how co-ordination works and why it so often doesn’t, as well as shedding light on the mechanisms countries have developed to govern these interactions. In doing so, it addresses another key requisite to organising co-ordination, namely government capacity. Sub-national actors, especially, need to be equipped with the right skills and resources to carry out their responsibilities and to engage with stakeholders, across the public, private and civil society sectors. This report offers a toolkit to policy makers to assess their needs for capacity development

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Sub-national capacities for effective public investment

Investing together across levels of government requires equipping sub-national authorities with the necessary capacity to engage with other levels of government and to carry out public investment programmes and projects effectively. This chapter identifies the key governance capacities across the investment cycle that sub-national governments need to have if they are to design and implement sound public investment strategies for regional development. It also explores some of the ways in which capacity needs at the sub-national level differ, not only across OECD countries, but especially also within them. It then provides practical guidance for assessing and strengthening these capacities. A diagnostic assessment framework is presented at the end of the chapter to serve as a first step in helping sub-national governments assess their capacity needs and develop a tailored set of actions to strengthen them.

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