International experience concerning the development of local finance

Abstract

In Europe, the decentralization of the exercise of public functions has been a marked tendency since the early 1980's. A related phenomenon was the wide acceptance of the European Charter, adopted within the framework of the Council of Europe. The Charter is a fine example of the process now called “open method of coordination”, whose objective was to define the framework of this decentralization process without intervening in the internal affairs of individual states. The political structure, the constitutional model and the historic traditions of the countries produced highly variegated subnational governmental systems. In the European Union, there is no specific model of local government; however, it is indisputable that a Europe undergoing the process of unification can offer several models to be followed in the field of subnational government. The present essay sheds light on the activity of some forums which serve as a basis for the above mentioned “method of open coordination”, and which, nonetheless, deserve attention. We find it regrettable that Hungarian decision-makers do not investigate good international practices carefully enough; what is more, they do not even share those experiences be gained within the framework of international relations. We are glad to have the opportunity to present our experience to the professional public in this journal. In the section below, we provide information about those events in the Council of Europe, the OECD and the French Presidency of the EU, which dealt with the issue of modernizing the financing of local authorities. Most probably, this is not accidental.