who can affect the outcome of a proposed intervention".<sup>8</sup> Key stakeholders are those whose real participation is essential for the initiative's success.

> Real participation means involving citizens at every stage and level. This includes the micro or community

> level, the meso or intermediate level (local governments, NGOs) and the macro or national/policy level

> (central government, World Bank staff). Real participation implies that development choices are taken

> under conditions of full information, full representation of all interests, and a hard budget constraint. These

> conditions can be met in substantial measure, if not fully, by good program design. Under these conditions, elites will be driven towards proposals that benefit all stakeholders, including poor and marginalized

> groups. Some caveats are in order. If poor and marginalized groups are prevented from participating effectively, elite capture will follow. Similarly, if community members dependent on natural resources and other environmental interest groups are inadequately represented, environmental degradation may result.

Empowerment means real control by communities over resources, project/program design and selection, implementation, and M and E. A good test of whether a pilot program will foster empowerment is whether the community/local government have full control over the financial resources to be used in the program, i.e whether _the money is in the hands of the community,_ and whether these resources are part of a _single untied development budget,_ rather than earmarked for specific purposes.<sup>9</sup> Shifting power from the top to the bottom requires strong political commitment. Good design is allimportant: without it, power may simply move from ineffective central governments to ineffective local ones. So, empowerment requires both political commitment and good design. These in turn should be used to ensure six critical factors.

1. Devolution of authority and resources;

2. Real participation of primary stakeholders. "' 3. A communication program that provides a two-way flow of information.

4. Co-financing by communities to promote local ownership.

5. Availability of technical assistance and facilitation from the private sector and/or higher administrative levels.

6. Pro-poor market development, including facilitation of producer/user groups that can federate upward to tap national and global markets. X 1

- _2.1.2 Devolution of authority and resources._

Shifts in power relations are fundamental in CDD. 1<sup>2</sup> Communities and local governments can be truly empowered only by giving them an _assuredjlow offunds from the central government,_ as well as the _authority to levy local taxes and user charges._ Only then can they participate fully in development bargaining. Untied funds are crucial to enable communities /local governments to choose their own priorities, and create skills through learning by doing. It allows them to evaluate propositions against a

> 8The World Bank, 1996. The World Bank Participation Sourcebook, Enviromnentally Sustainable Development, Washington D.C.

9 World Bank. Communitv Driven Development: a Vision of Poverty Reduction throueh Empowerment. Washington, D.C., Dec. 2000.

'° See Annex 3 for details.

> " Narayan, Deepa (Ed.). Empowermnent and Poverty Reduction: A Sourcebook, The World Bank, Washington D.C.,

> Dec. 2002. 12 Ibid.

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