Participatory budgeting-the Australian way

For the first time in Australia a local council has used a deliberative democracy approach to obtain citizen advice on key decisions regarding the full range of Council services, service levels and funding. Typically a participatory budget (PB) gives citizens authority in relation to a component of the local government budget. The City of Canada Bay Council, in metropolitan Sydney, went well beyond this. In this paper the Canada Bay Citizens’ Panel (CP), the name given to the PB, is compared to the traditional PB process highlighting three distinctive features of this process: (1) the use of a randomly selected group of citizens; (2) the role of the newDemocracy Foundation as a ‘nonpartisan intermediary organisation’ (Kadlec and Friedman, 2007); and (3) the engagement of council staff through a parallel process convened by the Council, using a randomly selected staff panel. Whilst it is too early yet to make any final judgments, there is promising evidence that the recommendations of this CP will be seriously considered and that this engagement model will be used again by the City of Canada Bay, for the next four-year delivery plan and other contentious issues. Even though the Canada Bay Citizens’ Panel process is not yet complete, it is already clear that its impact will be felt, not only on the budget of the City of Canada Bay, but more broadly as an exemplar for local governments in Australia thinking about engaging their citizens.


Participatory budgeting -the Australian way
For the first time in Australia a local council has used a deliberative democracy approach to obtain citizen advice on key decisions regarding the full range of Council services, service levels and funding.The unanimous decision by the Councillors to experiment with a participatory budget (PB) that examined all services and funding for a four-year planning period is unlike any PB convened elsewhere.Typically a PB gives citizens authority in relation to a component of the local government budget (Pateman, 2012).The City of Canada Bay Council,1 in metropolitan Sydney, went well beyond this.This initiative had other differences; for example, rather than opening the process to any interested citizens, it engaged a mini-public (Fung, 2003) using a deliberative approach (Cohen, 2003), with the final recommendations developed through dialogue and deliberation (Escobar, 2011) rather than aggregating preferences through a vote (Fishkin, 2010).
This PB initiative arose from the newDemocracy Foundation2 suggesting to the Mayor of Canada Bay Council in late 2011 that there was a better way to engage their citizens.Canada Bay Council has a history of poor turnout at public meetings seeking citizen input.And when they do get participation it is often from people angry about a specific development. 3he newDemocracy Foundation offered to recruit a representative group from across the local government area to deliberate and provide considered and reasoned recommendations to Council.In return for providing process design and oversight, the newDemocracy Foundation asked that the Council commit to taking seriously the advice from its citizens.This was not to be a tokenistic process.Council agreed that the Citizens' Panel would 'set the level of service to be provided… subject to final approval by the Council.' 4   In this paper the Canada Bay Citizens' Panel (CP), the name given to the PB, is compared to the traditional PB process highlighting three distinctive features of this process: (1) the use of a randomly selected group of citizens; (2) the role of the newDemocracy Foundation as a 'nonpartisan intermediary organisation' (Kadlec and Friedman, 2007); and (3) the engagement of council staff through a parallel process convened by the Council, using a randomly selected staff panel.A preliminary assessment will be made of the success of the initiative in influencing Council decisions and impacting on Council engagement processes.The conclusions are tentative as the research is not yet complete.5

Comparison to traditional Participatory Budgeting
Participatory budgeting is most often undertaken at a local government level and involves a series of activities aimed at engaging a wide range of citizens in making decisions about a component of the local government's budget, usually in regard to public infrastructure (Wampler 2007, Sintomer et al., 2005).
As mentioned, the Canada Bay initiative opened the entire Council budget to citizen review and Council agreed to accept their recommendations.However, instead of inviting all interested citizens to participate, Canada Bay used a mini-public.Representativeness 6 and deliberation 7 were privileged over widespread participation for two reasons: (1) the newDemocracy Foundation suggested that this CP could provide the Council with a more extensive and considered response from its citizens than other approaches had achieved; 8 and (2) there was a history of disappointing participation in Council's previous attempts to involve citizens.The citizens of Canada Bay do not generally participate in consultation processes initiated by Council.What was unknown was why.As one panelist commented: were residents basically satisfied with their Council?Or were they apathetic? 9The Canada Bay Citizens' Panel demonstrated that the citizens are not apathetic, although it did suggest they are broadly satisfied with how Council operates-at least by the time the Citizens' Panel (CP) ended. 10nother approach to local budgeting has been undertaken in China (Fishkin et al., 2010).This model uses a randomly selected representative group to consider local government expenditure on selected infrastructure projects.A key difference is that the Canada Bay Citizens' Panel focused on developing a collective view amongst the panelists, whereas the China initiative uses an aggregation approach,11 with deliberation followed by a poll.It could be argued that not only was there a normative argument in favour of using deliberation for the CP, but the scope of the matters to be considered could not be adequately addressed by voting on individual service levels. 12articipatory budgeting has been described as 'a decision-making process through which citizens deliberate and negotiate over the distribution of public resources' (Wampler, 2007, p. 21).Wampler suggests that participatory budgeting addresses two needs: improving state performance and enhancing the quality of democracy.The Canada Bay CP involved citizens in deliberation over the distribution of public resources; their recommendations focused on specific ways to improve the efficiency of Council's services; and the process engaged twenty-seven citizens, the majority of whom had previously never been involved with Council, in dialogue and deliberation13 around Council's services and funding.
An element of the Porto Alegre approach to participatory budgeting that has received less detailed consideration (Pateman, 2012) is participation around thematic programs, where citizens are involved in a more general consideration of a local government budget and can make suggestions in regard to broader priorities (Koonings, 2004).It could be argued that the Canada Bay CP was similar to this aspect of the Porto Alegre model14 with panelists choosing to use the themes from the Council's strategic plan FuturesPlan2015 to guide their work.
The Mayor described Canada Bay's existing methods for engaging citizens as a combination of public meetings and market research.He saw the CP as a 'fresh approach' that could address the current situation, where at previous general consultation evenings, Council would be 'lucky to get one person there'.After the CP process was completed the Mayor suggested that 'this is possibly the best way that we've actually processed thoughts from [a] collective group, without doubt.' Consistent with other research (Lubensky & Carson, in press), personal invitations to participate in the CP generated significantly greater interest than previous public invitations to participate had achieved.The initial survey of panelists revealed that, in the last year, the majority of panelists had not attended a Council event nor had they contacted Council about a local issue of concern.By the end of the process the majority of panelists said it was likely or very likely that they would contact Council about an issue of concern in the future.
In addition, the invitations indicated that the CP would be able to influence Council's decision-making on a significant matter. 16It is clear from surveys that this influenced many of the panelists to participate.When asked why they had volunteered, the panelists identified the ability to impact on decision-making in their local community as the driving motivation.
It was evident from panelists' comments at the early sessions that some came to the CP with issues of personal concern that they hoped to address through this process.However, during the CP, the facilitators invited them to think of themselves as a mini-public representing the wider community.They clearly took up this invitation because, in the final survey of panelists, the majority indicated that other panelists had achieved this either 'reasonably well' or 'extremely well'.Senior Council staff who attended the sessions agreed, with one saying 'I was surprised at how quickly they left their baggage at the door.' The role of the newDemocracy Foundation The newDemocracy Foundation played a major role in this process, initiating and setting the broad design, 17 recruiting panelists, participating on the oversight committee, 18 attending all sessions of the CP and handling panelists' questions outside of the formal sessions.In addition the newDemocracy Foundation effectively used their preexisting media contacts to get positive media coverage for the Citizens' Panel in both the local newspaper and major daily papers.Five articles on the Citizens' Panel were published in the lead up to, during and immediately after the formal process. 19  Pateman, an advocate for participatory democracy, argues that one limitation of mini-publics is that 'it does not appear that the public as a whole knows much about them' (2012, p. 9).However, this might also be said of participatory budgeting, despite the larger numbers of individual citizens who participate in these processes (Wampler, 2007).As Smith (2008, p. 15) notes, 'To achieve significant levels of public recognition and understanding, mini-publics must rely on the media and this is a further aspect… that has been poorly theorised within the deliberative democracy literature.'The newDemocracy Foundation's ability to obtain sustained and positive media coverage for this process demonstrates that minipublics are not intrinsically uninteresting to the media and the broader public.
The Executive Director of the newDemocracy Foundation promoted the Foundation as an independent unaligned party in this process, one that did not have any vested interest in the outcome, and observation of the process suggests that the panelists valued this role. 20It is not unusual for processes engaging mini-publics to utilise some form of 'independent' 17 After Council agreed to work with newDemocracy, the Foundation prepared a Process Design Overview (2011) document setting out the key features of the process that would need to be in place to ensure their continued support. 18The oversight committee involved the key Council officer, the independent consultants engaged to facilitate the process and the Executive Director of the newDemocracy Foundation. 19See Campion (2012), Ward (2012), Pandya (2012a) and (2012b) and Armitage (2012). 20For example panelists sought the Executive Director's advice during the CP sessions and included him in working group emails.oversight for the process;21 however, most PBs are convened by Council staff, often from the Mayor's office (Goldfrank, 2007).
It seems unlikely that either Council staff or the facilitators could have played the role fulfilled by the newDemocracy Foundation, as all parties valued the independence and impartiality the Foundation brought to the process.Both senior Council staff and Councillors identified the 'partnership' with the newDemocracy Foundation as an important and valuable element of the process, with the Mayor saying that because of this partnership he was 'satisfied that things were being done properly'.
As Kadlec and Friedman (2007, p. 7) note in their response to criticisms of deliberative democracy, 'Who will lead, design and control a deliberative process is critical because the democratic integrity and efficacy of the process can be compromised in a hundred little ways.'They propose, as a guiding principle 'that no single entity with a stake in the substantive outcome of the deliberation should be the main designer or guarantor of the process,' identifying two options to address this risk: nonpartisan intermediary organizations or multi-partisan deliberative leadership coalitions.The newDemocracy Foundation, as a nonpartisan intermediary organization, led, designed and controlled the deliberative processes, thereby strengthening its democratic integrity and efficacy.
It should be recognized that the amount of time committed by the newDemocracy Foundation was substantial and, if this work had to be recompensed, it would inflate the cost of any similar process.One Council officer noted 'that if we were to try and buy in that expertise it could be out of the reach of Council.' Further, if Council were to pay for this work it could undermine the independence and impartiality of the role and 'change the dynamic'.

Engaging Council staff
An unusual component of this process was the decision by the Council Executive to hold a parallel process internally to engage Council staff. 22n an early interview with a senior member of the Council staff it was noted that there was a need to involve the staff to ensure they understood what was happening with the CP process.In particular there was concern about how staff members might react to being required to implement changes arising from the CP process if they were not engaged themselves. 23he Staff Panel (SP) involved 23 randomly selected staff24 from across the organisation.The SP met three times and each session was facilitated by the Council's Manager of Corporate Strategy, who replicated the CP processes.The SP also used the FuturesPlan20 themes to guide its work; however, mandatory services25 were excluded.The SP report was intended to be an input for the CP and was presented to the CP at its last meeting.The SP report identified where the panel supported an increase, decrease or maintenance of the status quo for each of the broad service areas.The SP did not explicitly address funding sources or the issue of a rate rise, although its members did identify where their recommendations would require additional funding.The CP in its final report to Council recommended that Council consider the SP report as well as their own.
Senior Council staff identified many parallels between the CP and the SP.For example, like the citizens, many staff members were not aware of the range of Council services.They also considered the fact that the staff recommendations 'aligned with the community's views' as evidence that Council staff 'understand their community'.Whilst this was welcomed it did not preclude the need for Council to engage with its citizens.Legislation in NSW requires all Councils to consult with their community around medium-and long-term planning. 26In addition, Senior Council staff believed the SP had been a 'good experience for staff' and indicated that this approach to internal engagement would be used again.
Parallel processes are not unheard of; Best et al. (2011, p. 9) describe the Recife PB27 that includes a parallel process to engage young people through local schools.28However, whilst staff members are often engaged in PB as technical advisors (and this happened with the CP) the parallel process engaging staff at Canada Bay would appear to be unique both in PB and deliberative democracy initiatives.

Influence and impact
In assessing the success of the CP there are two key indicators: (1) influence -to what extent does the Council adopt the recommendations of the CP; and (2) impact -does the process change how Council engages with its citizens in the future.
Whilst most PB processes, which address a component of a Council budget, involve a commitment to implement the recommendations of the PB, deliberative democracy approaches have yet to achieve this level of influence (Hartz-Karp and Briand, 2009).This is why the Canada Bay CP is so distinctive because 'Council agreed that the Panel will set the level of service to be provided for in the 2014-18 Delivery Plan, subject to the final approval of Council.'29This was a significant move for this Council whose previous approaches to consulting their communities sat predominately in the first two levels of the IAP2 spectrum30 : 'inform' and 'consult'.The most recent major consultation process undertaken by the Council, prior to the CP, was in 2008 to develop the FuturesPlan20, which moved into the level of 'involve'.The CP sits squarely at the 'collaborate' level.
The CP ultimately achieved consensus around a comprehensive range of recommendations31 including tolerance for a rate increase, subject to Council first addressing the other elements of the Panel's recommendations.The Preamble to their report was carefully crafted to highlight this: The panel was not aware of the range of services provided by Council.The Citizens' Panel has not been able to identify significant cuts to services.The Panel is concerned about the existing shortfall in ageing infrastructure and lack of available funds to fix this.The Citizens' Panel can tolerate an increase of about ten percent per annum in rates, provided that Council first investigates all avenues for [generating] income and consider the initiatives and suggestions for both short and long term efficiencies identified by the Panel.Council should consider raising the 'minimum rate'32 and investigate how to minimise the impact of any rate rise on those least able to pay.Finally, Council needs to support any changes with comprehensive and effective communication so that the community understands the needs, considerations and efforts that have gone into making these changes. 33he newDemocracy Foundation (2012b, p. 4) has suggested that The panel reached a pragmatic consensus that reflected the actual financial position of the Council.Their set of resolutions was quite different to, and arguably more considered than, results from previous methods of community engagement.The CP's final report will be presented to the incoming Council in November 2012 following the local government elections in September.Already some Councillors have indicated that the Panel's recommendations will be very useful to the incoming Council, saying, 'I would expect [the] new Council to really take seriously these recommendations ' and 'I would think [with] all the work that's been put in [the new Council] will take on the recommendations.'And in the lead up to the CP's report being presented to the new Council, Council staff have been reviewing the recommendations and preparing detailed advice for Council on their implications.
All Councillors and senior Council staff were open to the CP from the beginning, with the Mayor describing it as a 'wonderful opportunity… one that can't be missed'.Commitment to the process of working with their citizens in this new way is an important factor to delivering valuable and sustainable outcomes (Twyfords, 2012).Whilst the lead officer within Council for this process was the Manager of Corporate Strategy, the senior Executive team attended all sessions of the CP.This allowed them to see firsthand how the CP operated.They were also actively involved in providing advice to panelists at the first four sessions.Elected Councillors, too, attended a number of sessions to observe the process and talk to the panelists.
A senior Council officer indicated that this process has 'probably changed my mind on having a group of people that you can use as a really good sounding board for the whole broader range of services.'The Mayor summed it up when he said, 'Without doubt this is the best formal engagement of our community we've ever been part of.'There is now strong support for the CP process and the suggestion that it could be used for similar planning issues in the future.Many senior Council staff and Councillors are already talking about 'how we could make it better'.One Councillor went further and suggested that this approach should be recognized by other levels of government as a legitimate way for councils to meet their legislative requirements to consult their communities about planning decisions.
In addition there has been a great deal of interest from other local councils in this process.The newDemocracy Foundation, as well as staff from Canada Bay Council and the facilitators, have been invited to speak to numerous other Councils about the CP.Also, in the recent local government elections in NSW one political group, as part of their election campaign, proposed to use citizens' panels for community input on contentious issues (McDougall, 2012).

Conclusion
The Canada Bay Citizens' Panel was the first time in Australia that a Council has engaged with a representative group of its citizens, opening their books for their consideration and committing to act on their recommendations.
Whilst the CP did not follow the traditional model of PB originating in Porto Alegre, it used a deliberative mini-public, which was well suited to the community and council.This is evidenced by the number of people volunteering to participate, many more than usually attend council consultations, and the commitment of those selected to participate on the CP attending over 30 hours of meetings and doing a significant amount of work outside of the formal sessions.Random selection and a personal invitation were key to this positive response.
The role of the newDemocracy Foundation was also important as the catalyst for this process as well as fulfilling the role of a non-partisan intermediary.Whether the newDemocracy Foundation could realistically continue to play this role if a large number of councils were to choose to use a CP is unclear.If not, the question of how a similar level of trust in the process could be achieved would need to be considered, for example through an independent steering committee.Would the more traditional PB approach of using council staff deliver this trust or could a multipartisan deliberative leadership coalition be established to support councils?
The engagement of council staff through a Staff Panel, modeled on the mini-public, was novel and valuable.The SP provided additional input to the CP but also demonstrated how the mini-public approach and deliberative techniques can be used to structure an effective staff consultation process.This model may have value to other organizations whether undertaking a CP or not.
Finally, whilst it is too early yet to make any final judgments, there is promising evidence that the recommendations of this CP will be seriously considered and that this engagement model will be used again by the City of Canada Bay, for the next four-year delivery plan and other contentious issues.Even though the Canada Bay Citizens' Panel process is not yet complete, it is already clear that its impact will be felt, not only on the budget of the City of Canada Bay, but more broadly as an exemplar for local governments in Australia thinking about engaging their citizens.