Introduction of MCPM
Minimum Conditions Performance Measure (MCPM) is a system of measuring the performance of local bodies on the basis of certain set standards and tie up the block grants and revenue sharing with their performance result. In Rule no 273 (d) of Local Self-Governance Regulation, it has been stated that Ministry of Federal Affairs and Local Development can evaluate the local bodies on the basis of indicators of minimum conditions and performance measures and thereby award them in the recommendation of Local Bodies Fiscal Commission. MCPM was introduced and tested in 20 districts from 2005/6 on pilot basis. Later the Government of Nepal, with the objective of increasing the mobilization of local resource and their effective utilization, had decided to allocate grant on the basis of their performance in Fiscal Year 2006/7. It is an objective evaluation of local bodies and a measuring rod to assess their accountability, transparency and responsiveness. This on one hand encourages the local bodies to improve their performance by recognizing their good undertakings and on the other helps to tie up grants with their capacity that will enable capable local bodies to acquire additional grants. Along with this it will assess their strengths and weaknesses and improve their performance by minimizing weaknesses. It has been mandatory to fulfill the minimum conditions for measuring performance. The MCPM of the FY 2006/7 of all 75 districts (DDCs) has been conducted.