Aam Aadmi Party’s recent Swaraj budget in Delhi has received accolades from even its fiercest critics. The Rs 41,929 Crore budget has a strong emphasis on education and health, which is likely to impress its core vote bank. Being the first fully led citizen budget in India, clearly, it has set a new precedent, but it needs to be seen how well AAP can implement it.It should surely take some lessons from successful citizen led budget models worldwide. The first instance of citizens’ involvement and participation in the budget making process of a city was started in Porto Alegre, the capital of Rio Grande do Sul, a state in Brazil. History of Porto Alegre and first participatory budgetingIn 1980s, Porto Alegre lacked access to basic amenities such as sanitation, water, hospitals and schools and a significant percentage of the population resided in slums. With a view to transform the city, participatory budgeting, i.e. a budget decided and discussed upon by local citizens came into being. Participatory budgeting was initiated and supported by three mayors, elected from a coalition led by the Workers Party (PT), and their staff. There are representatives from each community, belonging to low-income districts, who decide upon the allocation of resources through the process. Priority is given to progressive distribution of the resources, regardless of individual representatives’ demands, so that poorer areas receive more funding than the well-off ones.The decisions of the citizen participants primarily emphasize infrastructure investment. However, participation is not just restricted to the middle class or conventional supporters of the Workers Party. People from low-income groups also take an active part in the process. The process strengthens accountability in the government’s budgeting mechanism. In Porto Alegre, for several rounds of meetings give public representatives ample opportunity to hold the administration answerable for false promises or for slow progress in work in their localities.Impact of the process The extraordinary success of the model led agencies like World Bank and UNDP to do impact analysis studies. The UNDP study, being latest, revealed some great outcomes: 1. The average number of housing units produced locally rose from 493 per year in the period 1973-1988, to 1,000 per year from 1989-2003, which allowed Porto Alegre to manage their growing housing deficit.2. The existing deficit of paved roadways decreased considerably from 690 km in 1998 to 390 km in 2003, which helped to improve access to collective transportation and public infrastructure in the poorest areas. 3. The percentage of dwellings with access to treated water increased from 94.7 per cent in 1989 to 99.5 per cent in 2002, while the proportion with access to the municipal sewer network grew from 46 per cent in 1989 to 84 per cent in 2002. Further, the percentage of treated liquid waste improved from 2 per cent in 1989 to 27.5 per cent in 2002. 4. The number of public schools rose from 29 in 1988, to 84 in 2002, with a subsequent increase in enrolment from 17,862 students to 55,741 students respectively. Shortcomings of the process and lessons for Aam Aadmi PartyInterestingly, PT is quite similar to the Aam Aadmi Party is many ways.Formed in the 1980s, PT has asserted its commitment to greater citizen participation and prioritizing pro-poor policies, which is the basic premise of AAP as well. PT’s election to municipal office in Porto Alegre in 1989 and AAP storming to power in Delhi, both, had two things in common - Deeply indebted municipal bodies and lack of basic amenities for a significant percentage of the city’s population. Though Porto’s participatory budget process was successful, it has several shortcomings as well, which AAP needs to take in consideration for the future as well. 1. While low-income groups reportedly influence the allocation of a portion of public funds, the “poorest of poor” are left out of the process, a fact which the World Bank study emphasizes strongly. 2. Limitation of finances for participatory budgeting, which restricts the scope of budget programs. Because low-income groups were involved in community struggles earlier, their representatives continue to dominate the community discussion process. 3. It has been observed that communities are less likely to participate once their demands are met.4. Lack of support by the local media for such initiatives, can hinder the scaling of such initiatives to other parts of the country. In AAP’s context, this is true since not much media attention was given to the process. 5. To avoid the possibility of unreasonable proposals by citizens, it is important to maintain transparency and make the citizens aware of the funds position and constraints of the municipal bodies. Post Port Alegre’s success, more than 140 of the 5,571 municipalities in Brazil have taken up participatory budgeting. Globally, more than 1500 cities across several countries have involved their citizens in the budget making process. A map below shows the cities where some form of participatory budgeting (definition has been broadened) has been tried and experimented with.Source: European University Institute