Central-local relations
The question of central-local relations comes down to the question, what powers does a central government have to control local governments, and how or when are those powers exercised?
One would expect that in a system of central-local relations there would be circumstances, albeit exceptional ones, in which the central government (or an administration above local government) could take over the functions and operations of a local government, or direct it to take or refrain from particular actions.
Such reserve powers, where they exist, are necessarily limited to special circumstances such as extreme mismanagement or dereliction of duty. Therefore, they are not suitable for exercising routine or continuing control over local government, although they do set some limits to local autonomy. For example, in studying the Fukushima incident in Japan, Matsui finds that Japan's central government had too little power to act decisively in an emergency and that local governments had too little power to orchestrate recovery after the emergency was over (Harding and Sidel 2014, chap. 7).What is quite striking in the case of Asian states is the absence of such oversight provisions in the law or the constitution. In those systems where local autonomy is guaranteed constitutionally, such reserve powers are indeed rare. For example, Indonesia's Law on Regional Autonomy of 2004 provides for the abolition or merger of a region (not for it being taken over) if it is unable to implement regional autonomy.30 Regional heads are directly elected and can only be dismissed by the regional assembly through a tortuous procedure. Dismissal is only available under a violation of the oath of office or failure to fulfil duties. Even then, the assembly must pass a motion supported by at least two-thirds of those present, which must be at least three-quarters of the total membership.
The assembly must then refer their decision to the Supreme Court, which must examine and try the matter within 30 days. If the Supreme Court approves the decision, the assembly must pass a motion (similar to the Supreme Court referral) to refer the matter to the President. The President must then dismiss the person within 30 days.31 This does not apply to the commission of serious criminal offences, in which case the President may simply dismiss the offender.32Of course, there are other means of controlling local government. Finance is a perennial problem for local governments almost everywhere. Naturally, the impact of exercising local authority powers will be limited if there is inadequate funding. Therefore, local governments tend to find imaginative ways of raising money. Indonesia's decentralisation has been particularly problematical in this respect but illustrates how central government can place some control on both legislation and finance. The central government has power33 to invalidate local by-laws (Perda) on the grounds of being contrary to the public interest or higher law. The government has extensively employed this power, despite having only 60 days to review such laws. After that period, the by-laws are in force, and the government loses its power of invalidation. Nevertheless, out of 15,000 Perda, the government invalidated 951 between 2009 and 2012. As one would expect, the most common issue here has been by-laws designed to raise local revenue through local taxes and levies in ways that contradict central revenue streams. Apart from this, the Supreme Court has the power to invalidate local legislation on grounds of being contrary to higher law or because its enactment violated legislative procedure.34
Even so, there seems to be little evidence across Asia of any deliberate tightening of purse strings as a means of rolling back local government powers. Indeed, it may well be that such methods would be found unconstitutionally undermining local autonomy.
As we have seen above, in the Philippines, a local government’s fiscal autonomy is constitutionally protected. Local governments are entitled to an equitable share of the national wealth proceeds that are developed within their respective areas. In Indonesia, there is a separate law on Fiscal Balancing that ensures that the central government treats local governments fairly in this regard.35 To the extent that there has been a roll-back of regional governments’ powers in Indonesia following decentralisation, this has, under the revised law of 2004, taken the form of giving more powers to provinces. This has included supervisory powers over regional governments and provinces acting as agents of the central government. Arguably, the problem was not so much the difficulties with decentralising power to regional governments, which was done to outflank separatist tendencies in some of the provinces. Instead, the problem was that provinces had been unreasonably restricted in their decision-making capacities (Butt and Lindsey 2012, 171-2). Perceiving local government power as essentially legislative has the consequence that control over such power is seen as control over legislation. This system has created some confusion in Indonesia over the validity of local by-laws, which have been enacted profusely over the last 20 years. Administrative courts can review any administrative decisions made by local governments.36 But this is a system for citizen (rather than central) control over local governments. The lack of administrative mechanisms to call-in or reverse local decisions seems to be attributable to the constitutional entrenchment of local government autonomy. The overall picture is one of considerable legal uncertainty, even 20 years after the commencement of reforms. However, it cannot be denied that the outcome is one of considerable autonomy for local governments.In the Philippines, the Code deals extensively with ‘inter-governmental relations.' Although the President exercises supervisory powers over local governments, this has to be exercised through the relevant intermediate government and is confined to keeping local governments within their powers, rather than calling in their decisions.
Intermediate governments have their own supervisory powers, but these again are confined to ensuring lower levels of local government act within their powers.37 In coordination efforts, local governments must be allowed to participate in planning and implementation. They can request the President to order fiscal and other assistance.38 Again, the outcome is one that exemplifies local government autonomy.Taiwan's case is described by (Yeh (2014) as one of “hybrid and dynamic transitional federalism,” where local government elections were the basis for the emergence of a multi-party system. Therefore, progressive empowerment of local governments renders the legitimacy of the centre simply retaking control as superficial. Conflicts between local and central governments have indeed been fierce, given the usual situation of political-party antagonism. In two notable cases, the National Health Insurance and Local Elections cases, the Constitutional Court has acted as the arbiter. In both cases, it crafted a solution designed to lower the political temperature rather than simply endorsing the central government's position.
Where local-government autonomy is constitutionally entrenched, we have seen that it becomes difficult for a central government, short of using drastic emergency powers, to exercise real control over local governments. Central governments are thus usually reduced to invoking legal (rather than administrative) processes if they wish to control or reverse local governments or oust local government leaders. On the other hand, where local government is provided for statutorily, the extent of local-government autonomy is one for the national legislature to decide, absent constitutional restraint. But again, what is quite surprising is that there appears to have been no serious attempt to roll back or exercise greater control over local government powers. Malaysia is an exception here, having moved from strong elected city governments (1953-1965) to emasculation (post-1965). At the root ofthe narrative oflocal governments' increasing autonomy is the fact that these governments, across almost all of Asia, are elected and locally accountable. They enjoy a legitimacy that makes concerted control from the centre virtually impossible, short of glaring corruption or jurisdictional illegality.