The Nexus Between Human-Rights-Based Approach and Intergovernmental Fiscal Transfers for Sustainable Development

The ultimate objective of intergovernmental transfer is to enable each level of government to respect, protect, and fulfill social, economic, cultural, and political rights. As a result, human rights should be embodied as a central element in government budget reflecting revenue allocation and expenditure priorities. However, the economic rationales may not be fulfilled due to tax collection inefficiency, a sense of “free-ridership,” or fiscal profligacy leading to regional development imbalances. Moreover, important principles embodied in human rights such as participation, accountability, and empowerment of marginalized groups could be sidelined. This chapter analyzes the conceptual and practical underpinnings of transfer programs in Ethiopia and the need to address human rights to achieve development in an integrated manner. The study further argues that the nexus between human-rights-based approach (HRBA) and fiscal transfers is compatible with a federal system in an effort to address regional development asymmetries.