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WHY THIS PRINCIPLE?

To address the increasingly complex tasks linked to public investment.
Sub-national governments are increasingly involved in complex tasks linked to public investment, such as supporting innovation, addressing challenges like climate change, or engaging in more complex financial instruments, which require new competencies and new more networking-type skills not previously held in many sub-national governments.

To develop institutional capacity and professional skills for better investment decisions, in particular in small sub-national governments.
Large regions, particularly established ones with substantial autonomy and significant numbers of staff, can tap a diverse range of professional skills. The same is not necessarily true for small regions, municipalities, newly created regions, or sub-national governments where decentralisation has outpaced corresponding growth in administrative capacity. Such challenges can hit particularly hard rural areas. Attracting needed skills to the public sector is a challenge for many regions where salary scales are uncompetitive with the private sector. Local governments also compete with each other and central governments to attract talent.

To enhance sub-national governments’ access to skills and external support.
This can be available through other governmental entities or outside of government through universities, technical consultants, quasi-public agencies. This is particularly relevant for sophisticated projects, such a “mega-projects” or projects with network characteristics, technical requirements may extend beyond standard project appraisal skills and require specific types of expertise (e.g. engineering).

IN PRACTICE

• Pool expertise across jurisdictions in areas of needed expertise (e.g. PPP, procurement, regional development agencies) (all levels).
  
  
• Use common e-government platforms to narrow gaps in capacity across regions or localities and facilitate peer learning (all levels).
  
  
• Identify sub-national governments/regions with the highest capacity challenges (national).
  
  
• Identify binding constraints for sub-national capacity building (all levels).
  
  
• Accompany decentralisation reforms with policies to strengthen sub-national capacities for investment (national).
  
  
• Distribute guidance documents in areas such as planning, project appraisal, procurement, or monitoring and evaluation (all levels).
  
  
• Adopt open, competitive hiring and merit-based for areas of needed technical expertise (all levels).
  

PITFALLS TO AVOID

• Recreate needed expertise in every jurisdiction, regardless of scale and cost effectiveness
  
  
• Outsource all competencies resulting in a minimum level of in-house skills
  
  
• Have high turnover of staff in teams involved in public investment
  

GOOD PRACTICES

‌‌‌‌	See real life examples on how countries have been putting this principle into practice. Read more

 COUNTRY PROFILES

 SELF ASSESSMENT QUESTIONS