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Federalism has emerged as a winner globally over the course of the Covid19 crisis. Faced with a public health emergency of unprecedented scale, many central governments, including those of India and the USA, have failed to respond properly while some states in these countries have taken strides to mitigate the crisis. The response of states like New York and California in the US and Kerala and Odisha in India have been touted as success stories of states within a federalised setup. And Nepal’s case has not been different.

Local governments across the country have stepped up their game and taken initiatives to set up quarantines, track people who arrived from abroad or outside their units and disbursed relief material to vulnerable citizens, giving the federal government a run for their money. Lately, they have also provisioned the rescue of migrant workers, students and others stranded in Kathmandu. Given their new structure and a lack of clarity regarding their roles, responsibilities and limited availability of resources, provincial governments have not been able to respond as efficiently as they may need to. Nevertheless, they have played a pivotal role in setting up Covid19 dedicated hospitals and chartering additional relief through local governments in their provinces.

While some states in federal countries have abetted the recklessness displayed by central governments, others have proven to be just as reckless. Consider Texas and Florida in the US, where governors were more concerned with the economy than with public health, even though epidemiologists and economists alike have agreed that the best course of action is to put the economy in a ‘medically induced coma’ over the duration of the crisis.

Some states in India have had a similar track record. The chief minister of Uttar Pradesh, for example, engaged in mass festivities in Ayodhya while the country was in lockdown as per the central government’s mandate. For every successful intervention by a state or local government, there are stories of the baffling failure orchestrated by other states.

This, however, is precisely the result of federalism. It gives a space for subnational entities to compete with or outperform the federal government, creating a yardstick for other states to measure their own initiatives. A vertical as well as horizontal competition enables heterogeneous governance measures in times of crisis. The proximity of subnational entities to citizens also gives an added incentive for prompt response and increased pressures for accountability. This does not always come to fruition due to reasons like corruption.

Nepal’s federal government has responded to the crisis by increasing tests, building new hospitals, enabling a lockdown and providing relief packages. However, in some instances its response has been slow and priorities have not always aligned with needs. It has failed spectacularly in procuring essential medical supplies and lately, the government’s steps to bring forth unnecessary and undemocratic ordinances show bare its misplaced priorities. Meanwhile, subnational entities, especially local governments, have been highly proactive. In this light, it is essential to analyse the response of these governments to the health and economic crises caused by Covid19 and also learn lessons from them to make future responses more proactive, furthering certain strengths of Nepal’s federalism while correcting its shortcomings.

‘Test, test, test and isolate’ has been the mantra for controlling transmission of the novel coronavirus and for preventing wider community spread. In reality, however, Nepal’s testing abilities have been thrown into doubt. There are only 13 labs currently in operation for PCR tests, which came into being largely due to the initiative of provincial governments. With pressure from local governments to test those isolated in quarantine facilities, the federal government has ramped up testing through Rapid Diagnostic Tests. Even though RDT is not considered reliable, it has helped identify additional districts across the country where Covid19 has been detected.

While it was speculated that the transmission would be widespread, given the federal government’s inability to test and isolate those who arrived from abroad, including neighbouring India, the RDT tests have proven the speculation that Covid19 is not centred in a few metros, as is the case in other countries, but has entered Nepal’s villages. Nepal has been in lockdown for over a month and that may have limited the spread. Local governments have been effective in ensuring that the daily needs of people are met throughout the lockdown. They have been at the forefront of relief distribution and the smooth supply of essential goods.

Moving forward, the health sector resources in local units farther from metros and municipalities and with fewer private or public hospitals will be severely constrained. This is where the foot soldiers of Nepal’s health sector and frontline workers at the rural level, including the Auxiliary Health Workers and the Auxiliary Midwife, Nurse and Female Health Volunteers, will be most necessary. They can proactively conduct contact-tracing, spread awareness, and train local citizens about ways to prevent transmission. Their effective mobilisation under the local government’s leadership is essential. As is the redirection of funds and resources to meet medical needs.

For all of this, decentralisation is the way forward. Local authorities should be granted the independence to plan and execute prevention strategies keeping their respective geographies and necessities in mind. This is also an opportune time for provincial governments to reevaluate and revamp health policies.

Karnali, one of the poorest provinces, does not even have a single ventilator while its budget was spent on unscrupulous splurges; the sum total of its constituency development fund given to legislatures was more than the sum of its internal resources. Provinces, unlike local governments, can allocate resources in specialised, larger hospitals with solid infrastructure. Additionally, given the three-tiered nature of Nepal’s federalism, the provincial and local governments are yet to work out functional linkages. Given the local government’s ability to mobilise local resources and the economies of scale offered by provinces, the health sector can be fine-tuned without depending entirely on the federal government.

While there are larger macroeconomic impacts of the Covid19 lockdown, more elemental interventions are necessary for the survival of the poorest and most vulnerable citizens. Governments across the world have recognised this and brought forth relief packages. Nepal’s federal government introduced a relief package for such families and set a relief distribution standard; the relief, in kind or cash, was to be distributed through wards under local governments. Local governments were asked to allocate the budget which, if inadequate, was to be complemented by budgets from federal and provincial governments.

The Province 2 government also instituted its own relief package, which was to be distributed through local governments. It was quite natural for local governments to be tasked with the responsibility of disbursing relief in the form of essential goods or cash transfers. However, they were not consulted. Given the variability of resources and needs across different local governments, the federal government’s standards were not viable for all governments. The federal government, after criticism from local governments, allowed for variation in the type of relief to be distributed. This, yet again, proves the efficiency of local governments in coming up with solutions to the immediate crisis.

Local governments, in most places, have distributed the first round of relief. They will see a severe constraint on their resources for distributing second and third rounds depending upon the length of the lockdown. As stipulated, hopefully, the federal and provincial governments will come to their rescue. It is even more essential to ensure that the relief reaches the neediest.

Even after years of executing transfer schemes in India, familiar problems of local elite capture and corruption make it difficult for the transfers to reach intended beneficiaries. Accountability pressures at the local level, since they are currently being headed by elected representatives, will mean that there will be strict constraints to corruption at least in disbursing relief in the times of crisis. Even if there is a possibility of corruption, local governments and ward offices are best placed to ensure relief is delivered. Right now, there are no better alternatives. However, it is also important to keep an eye on the types of relief disbursed through local governments, their effectiveness and for possible cases of corruption. When national media are focused on the larger scandals at the federal level, smaller cases of corruption at the local level could fade into obscurity.

The federal system in Nepal has been touted as the clear winner during this crisis, some going even further to argue that it will save us from Covid19. While there is a lot of truth to this sentiment, one need not be too surprised by this as decentralised governance offered by federalism was implemented partly keeping in mind exactly the kind of crisis that we are currently in.