Public Participation: Direct versus via the legislature
Since the 1960s, democracies, both established and those less so, have experienced a “participatory turn” in how people conceive of democracy. Generally, when citizens participate more directly in the policy and budget process, we have reason to hope for more representative, equitable outcomes. But how do we reconcile more direct forms of citizen participation with representation of the public indirectly through the legislature? Multiple forms of representation can raise challenging questions of legitimacy. We have witnessed this tension first-hand in Kenya in the aftermath of the 2010 constitutional reform, when fierce debate began about the competing legitimacy claims of county assembly members and unelected members of the public participating in executive-led participatory exercises around county level budget decisions.
In many countries, there is a tendency to dismiss the role of legislatures in the budget process as trivial or even counterproductive. Parliaments are either viewed as simply rubber stamping the executive’s budget, or, on the other hand, as reliably blowing up deficits and introducing infeasible projects into the budget to benefit their constituents with little regard for the public interest (this is the “common pool” problem, a version of the tragedy of the commons). If legislatures play little, or a mainly negative, role in the budget process, then there is arguably less need to concern ourselves with potential tensions between legislative budget practices and enhanced citizen participation.
In fact, however, we know relatively little about the ways in which legislatures amend budgets. Important empirical work suggests that “common pool” behavior does occur, which can lead to large deficits. And there is certainly literature that suggests a role for legislators in “logrolling” capital projects to benefit their constituencies, promoting narrow over broad public concerns. But very little of the global literature examines the details of the amendments that legislatures make at the level of ministries, departments and agencies.
Digging into our data
The 2017 Open Budget Survey tells us that in more than half of the countries surveyed (64 out of 115) legislatures amended their country’s budget in the most recent budget year considered. What the survey does not tell us is what kinds of amendments these were: which parts of the budget did legislatures change? To learn more about this, we pulled a sub-sample of 27 countries from this set of 64. The sample we ended up with is not random: we were constrained by data availability and language, which resulted in a bias toward Latin America. Still, it covers many regions and income levels.
We looked at amendments between 2016 and 2018 in each country by comparing the budget ultimately approved by the legislature to the executive budget proposal as tabled in the legislature. While we cannot generalize from this sample to all countries where legislatures make amendments, at minimum our findings suggest that common stereotypes about legislatures require nuance, and that legislative behavior around the world is quite heterogeneous.
First, the “common pool” hypothesis is supported in our sample, although one might expect it to be more dominant. When legislators change the total size of the budget (which they do in 73% of country-years in our sample), they increase it about twice as often as they decrease it, but this means the total size of the budget is decreased in one of four country-years in our total sample. While Sub-Saharan Africa and Western European legislators in our sample generally increase the overall budget and exhibit common pool behavior, legislatures in the Latin America and Caribbean region tend to decrease the total budget on average, which is at odds with common pool theory.
Some unexpected findings
Legislatures in the three low-income countries in our sample were surprisingly active, defying our expectations that democratic institutions are weaker in such countries. The Democratic Republic of the Congo (for which we only have one year of data) and Uganda are also countries where the ruling party has tended to dominate the political system, which might lead us to expect limited legislative activism (this is less true of Liberia, our third low-income country). Yet the total share of line ministries’ (MDAs) budgets amended was very high in these countries (over 90%) compared to higher income countries. Nigeria, our fourth African country (but a lower-middle income one), also has a very active legislature.
Given that legislatures are often blamed for adding infeasible capital projects to the budget, we expected that we would find, on average, positive amendments to infrastructure ministries. While legislators do tend to increase such budgets, they decrease them quite frequently as well, and they increase health and education budgets more often. Education and health were the most amended ministries in our sample, and they were both increased 82 percent of the time that they were amended, compared to just 60 percent for transport and infrastructure.
Of course, education and health budgets also contain capital projects that might be the target of logrolling by legislators, but we do not have sufficiently disaggregated data to look at this. Still, given that a large share of education and health budgets goes to recurrent expenditure (for health workers and teachers, for example) and to social programs that are not necessarily geographically targeted, we would expect a more pronounced focus on infrastructure budgets, where a much larger share of spending goes directly to capital projects.
Our findings did not support another expectation, that legislators would mainly be self-interested, seeking greater budgets for themselves whenever possible, plausibly at the expense of the executive. Surprisingly, our findings show that when they amend them, legislators are more likely to decrease the budget of the legislature (42 percent of the time) than the budget for the office of the president (31 percent of the time), and they tend to increase the president’s budget more often than they decrease it.
Large increases to ministry of finance and presidential budgets may reflect budget classification issues. We find that in Sri Lanka, for example, large increases in the Ministry of Finance budget reflect the addition of capital projects to this budget that should instead be classified with education, health, infrastructure and agriculture spending. Thus, legislators do use the budget to add pet capital projects, but these do not always show up in the relevant ministry budgets, a marker of poor budget transparency.
We were also surprised by the frequency with which legislators amended debt service and defense budgets, both areas where we expected less flexibility and greater deference to the executive. To be sure, these two items were the least likely to be amended by legislatures, consistent with our expectations. Yet debt service was the biggest negative amendment in 13 percent of our country-years, while the defense budget was amended more than half (53 percent) of the time and decreased in 45 percent of those cases.
Finally, it is remarkable that legislatures are fairly consistent in their behavior. In all three years of our sample we find that in six out of ten cases, MDAs are either always or never amended. More than 40 percent of MDAs are always amended. The data suggest that legislators are not capricious; they tend to focus on certain parts of the budget (a substantial share) year after year.
Our findings do not tell us anything about why legislators do what they do. For that, more detailed country studies will be needed, and we hope to undertake these in the future. However, even without understanding why legislatures amend budgets in the way that they do, these findings suggest that legislatures play a more robust and complex role in the budget process than is often assumed.
While legislatures may or may not be representative—this too requires further research—they do engage in a wide range of amendment behaviors that are plausibly connected to the public interest and cannot be easily dismissed as determined exclusively by their narrow self-interest or electoral concerns.
This should give us pause when thinking about how to make the budget process more representative: our findings indicate that we must do more to understand how existing representative institutions play their roles, even as we encourage greater direct citizen participation in the budget. Without this understanding, we risk delegitimizing, rather than strengthening, democratic institutions with a vital role to play in the budget process.