Policy Instrument:
Definition
Multilevel governance refers to the coordinated framework and dynamic processes through which public services are co-produced by actors across various tiers of government, often in active collaboration with civil society, citizens, and the private sector. It involves overlapping approaches to decentralisation or localisation, in which services such as education, water, social protection, transport, and urban development might be managed by subnational institutions, as local and regional governments are best placed to understand community needs.
Rationale
Effective multilevel governance systems are essential for delivering efficient public services and achieving sustainable development outcomes. By strengthening capacity and coordination among public actors at different levels, governments can significantly enhance the efficiency, equity, and long-term sustainability of public spending. Furthermore, this approach might support the alignment of localised actions with national and global development agendas, making it a critical mechanism for the localisation of the Sustainable Development Goals (SDGs).
Key features
- Dimensions of Decentralisation: Decentralisation can be categorised by the type of authority being transferred. This typically falls into three main dimensions: political (empowering subnational actors by devolving authority or sharing power), administrative (delegating responsibilities for assessing local needs and delivering services), and fiscal (transferring expenditure assignments and revenue-raising authority, and establishing systems for locally managed financial resources). Effective public sector performance hinges on ensuring that each dimension is robust, internally coherent, and balanced with the others.
- Spheres of Coordination: Effective multilevel governance systems require action and coordination across three distinct spheres: robust intergovernmental frameworks and systems; efficient, inclusive, and responsive local governments; and the active participation of society, citizens, and the local private sector.
- Institutional Prerequisites: To operate effectively within this framework, stakeholders at all administrative levels must possess three core attributes: legal authority and administrative discretion, functional organisational structures and processes, and adequate institutional capacity to perform their designated functions.
- Localising Global Frameworks: Multilevel governance mechanisms facilitate the translation of broad, global frameworks (such as the SDGs) into concrete local action, serving as the foundation for coordinated, inclusive, and coherent policy implementation across different territories.
This policy instrument prioritizes vulnerable and marginalized populations, who rely most heavily on public services. These groups benefit directly from enhanced service delivery through coordinated multilevel governance. Key groups include:
- Individuals and families living in extreme poverty or vulnerability
- People with disabilities
- Low-income families with children
- Elderly populations
- Residents of rural communities
- Urban populations in underserved areas
- Ethnic and minority groups
Overview
Several studies demonstrate that multilevel governance can significantly increase public sector efficiency. Using a comprehensive cross-country analysis encompassing a mix of developed and developing nations, Fisman and Gatti (2002) find evidence that countries with more decentralised expenditure have better corruption ratings, suggesting that managing spending or revenue collection at the regional or local level encourages citizens to hold government officials accountable, thereby decreasing corruption. Testing a similar hypothesis with time-series data from 21 OECD countries, Adam et al. (2014) identify a non-linear (inverted U-shaped) relationship between fiscal decentralisation and public sector efficiency, indicating that decentralizing power to local governments improves efficiency in the provision of health and education services up to a certain threshold, beyond which it can actually waste resources and harm overall efficiency. Furthermore, Epstein and Gang (2019) argue that a decentralized system is more efficient for social protection when the local administration's informational advantage regarding the actual wealth of its citizens outweighs the added costs of within-government lobbying.
Evidence from Country Examples
The Policy Basket contains several Country Examples that illustrate differences in the design, implementation, and impacts of various Policy Instruments. Under this specific Policy Instrument, multiple Country Examples are included. The selected evidence below draws on these cases to demonstrate how multilevel governance approaches to social protection programmes contribute to improved food security and poverty reduction.
Brazil: Brazil’s National Food and Nutritional Security System (Sisan) coordinates food security policies across all levels of government and civil society through an intersectoral, interfederative, and participatory framework. It operates via two interdependent bodies: a governmental pillar (Caisan) and a social participation pillar (Consea), which consists of two-thirds civil society and one-third government representatives. Domingos et al. (2023) note Consea was instrumental in constitutionalising the right to food and securing 30 per cent of the National School Meal Programme budget for family farming. Furthermore, Caisan's paralysis due to political instability in 2019 halted Brazil’s National Food Security Plan evaluations and left the country without a structured roadmap to fight hunger during the COVID-19 pandemic, as the body completely stopped publishing analytical results in late 2018. However, following Sisan’s 2023 reconstruction, recent CAISAN (2025) data shows a rapid recovery: severe food insecurity plummeted from 15.5 per cent (2021/2022) to 4.1 per cent (2023), lifting 24.4 million people out of hunger. Concurrently, extreme and general poverty rates dropped significantly (from 5.9 to 4.4 per cent and from 31.6 to 27.4 per cent, respectively), rescuing an additional 8.6 million people from poverty in under two years.
India: Launched in 2018, India's Aspirational Districts Programme (ADP) accelerates development in vulnerable regions by fostering convergence among local, state, and central governments, underpinned by a framework of cooperative and competitive federalism. Progress is driven by a real-time monitoring dashboard that ranks districts across five key sectors, leveraging data-driven competition to motivate local administrations to outperform their peers and accelerate human development. Evaluating the programme's first two years, Kapoor and Green (2023) found significant progress across almost all 112 districts participating in the ADP, with the most deprived areas driving the greatest change to catch up to higher-performing peers. Improvements were particularly strong in Health and Nutrition and Basic Infrastructure (the latter through sanitation and electrification). Supporting this, a mixed-methods analysis by the UNDP (2020) confirms major advancements in these sectors, alongside Education and, to an extent, Agriculture and Water Resources, concluding that the ADP's competitive model is highly successful in promoting local development.
- Political incentives: Decentralization often faces resistance because it requires national-level stakeholders to relinquish power and control over resources. Central‐level politicians prioritize re‐election, party dynamics, and coalition stability, while senior bureaucrats focus on expanding their own department’s influence, protecting career paths, and guarding against interference from rival agencies.
- Lack of commitment to decentralization: Political decentralization may remain superficial, with local governments granted limited functional authority. For example, elected local bodies may lack genuine decision-making power, as their plans often require central government approval. Similarly, constitutional or legal provisions for administrative decentralization may go unimplemented, leaving real authority centralized.
- Centralization of resources: Even when political and administrative powers are devolved, central governments often retain control by restricting fiscal autonomy. Underfunded local authorities become dependent on highly conditional grants, allowing sector ministries to micro‐manage spending—or simply reclaim frontline responsibilities under the guise of local incapacity.
- Emergency situations: Traditional multilevel governance frameworks rarely account for crisis contexts. During emergencies—such as pandemics (e.g., COVID-19), climate disasters, or energy crises—effective governance demands agile, adaptive coordination mechanisms. This requires redefining roles and responsibilities across government tiers to ensure rapid, context-specific responses.
- Heterogeneity of contexts: Multilevel governance frameworks must be tailored to each country or sector, guided by the specific objectives of intergovernmental analysis. Incentives for local stakeholders—politicians, administrators, citizens, and civil society—are highly context-dependent. For instance, a metropolitan mayor’s priorities will differ significantly from those of a rural district chairperson. Moreover, local governments should also be recognized as political entities with complex internal dynamics. While collaboration is essential, the motivations of executive leaders (e.g., mayors), elected councils, administrative staff, and frontline personnel often diverge based on their roles, hierarchical positions, and organizational priorities.
SDG 11 - Sustainable cities and communities
- Target 11.a - Support positive economic, social and environmental links between urban, peri-urban and rural areas by strengthening national and regional development planning
SDG 16 - Peace, justice and strong institutions
- Target 16.6 - Develop effective, accountable and transparent institutions at all levels
- Target 16.7 - Ensure responsive, inclusive, participatory and representative decision-making at all levels
SDG 17 - Partnership for the goals
- Target 17.14 - Enhance policy coherence for sustainable development
- Target 17.16 - Enhance the Global Partnership for Sustainable Development, complemented by multi-stakeholder partnerships that mobilize and share knowledge, expertise, technology and financial resources, to support the achievement of the Sustainable Development Goals in all countries, in particular developing countries
Relevant initiatives and recommendations include, but are not limited to: