This study examines fiscal and technical decentralisation in Zambia and its impact on local development. It aimed to assess the extent of devolution from Central to Local Government, analyze the state of fiscal and technical decentralisation, and evaluate stakeholders’ perceptions of the process. Using a mixed-method approach across seven purposively selected provinces, the study found mixed views on fiscal decentralisation, with challenges including misalignment between revenue assignments and expenditure responsibilities, lack of a clear funding baseline, and irregular intergovernmental fund transfers.

Devolution of functions from Central to Local Government was rated moderate, with several functions transferred under Cabinet Circular No. 2 of 2023. Stakeholders acknowledged that decentralisation promotes decision-making closer to communities and increases citizen participation, though some functions, such as motor vehicle licensing, face resistance from centralized structures. Limited institutional capacity at the local level also hinders effective project implementation. About 65% of stakeholders view decentralisation favorably, while 43% doubt Local Authorities’ capacity to implement projects effectively. Fiscal responsibilities often exceed local resources, creating horizontal fiscal imbalances across Local Authorities. The study recommends stronger coordination between government levels, adherence to good governance, and equitable resource allocation. Measures such as fiscal equalisation and aligning expenditure with fiscal capacity are essential to ensure sustainable local development.