Report on the situation of local democracy in the Principality of Monaco – CG/ BUR (5) 98

Prepared in connection with the application for membership of the Council of Europe
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Rapporteur:
Mr Riccardo VENTURINI (San Marino)

Documentapproved by the Bureau on 2 February 1999

I. INTRODUCTION

On 21 October 1998, the Principality of Monaco submitted its application for membership to the Council of Europe's Committee of Ministers.

The latter set the admission procedure in motion and referred the application to the Parliamentary Assembly for an official opinion.

In view of the above, and pursuant to its statutory objectives and on the basis of its Resolution 31 (1996), the Congress prepared this report on the situation of local democracy in Monaco, to be forwarded to the Committee of Ministers and the Parliamentary Assembly for information.

On 17 and 18 December 1998 the Rapporteur, together with Professor Jean-Marie WOEHRLING, expert (France), and a member of the Secretariat, went to Monaco on an official visit to draw up the report.

In accordance with the programme of the visit (Appendix 1), which was prepared in co-operation with the Directorate of Foreign Affairs of Monaco's Ministry of State, the CLRAE Delegation met the Government Councillor for the Interior and the Mayor of the Municipality of Monaco and his Municipal Council.

The Delegation was extended a very cordial reception by all of the above.

II. INSTITUTIONAL, LEGAL, SOCIAL AND POLITICAL CONTEXT

The Principality of Monaco is a hereditary and constitutional monarchy placed under the high authority of Prince Rainier III. Its Constitution was adopted in 1962. The Prince's powers are thus exercised keeping with the Constitution.

Under the terms of the Constitution, executive power is vested in the Prince. Executive power is exercised by a Minister of State assisted by a Council of Government. The Minister and Council report to the Prince, who has the power to appoint and dismiss them.

The Minister of State is a senior French civil servant on secondment who has been chosen by the Prince from a list of names proposed by the French Government. The Minister of State has three Government Councillors under his authority, each of whom heads a ministerial department: the Department of Public Works and Social Affairs, the Department of the Interior or the Department of Finance.

Exercising legislative power and control over the purse-strings, the National Council, which is elected by universal suffrage, passes legislation and adopts the national budget (about 3 billion French francs). The National Council does not have all the prerogatives of a conventional parliament. It does not have the power to remove the government but it can refuse to vote the budget or draft laws of the government. It cannot initiate legislation but it can adopt proposals which, with the endorsement of the government, become bills.

Judicial power is exercised by independent courts and tribunals.

The population of Monaco is currently estimated at about 31,000 inhabitants, comprising just under 7,000 Monegasques and just over 24,000 foreign residents, including 12,000 French and 5,000 Italian nationals. Only residents who have had Monegasque nationality for at least five years have the right to vote in elections.

With 31,250 wage-earners in 1997, the working population is greater than the number of inhabitants. This is explained by the fact that there are many jobs in Monaco for people who live in the adjacent regions.

The Monegasque authorities attach great importance to Monaco's admission to the Council of Europe.

Following admission to the United Nations and the OSCE, and in view of the fact that it cannot, for technical reasons, join the European Union, the Principality of Monaco considers accession to the Council of Europe to be the first real opportunity to become, at long last, a full-fledged member of the European field.

By opening up to Europe, the Monegasque authorities probably hope to project a more complete picture of their country, one that is closer to reality than the one commonly presented in the media.

For all the clichés about the splendour of everyday life in Monaco, the Monegasque authorities must contend with real problems, the most serious being town planning on a very small territory, the many foreign workers and assistance to the aged.

By joining the Council of Europe, Monaco hopes to make an active contribution to European integration through the experience and traditions of its long-standing state and through an exchange of ideas and implementation of joint programmes with member states of the Organisation which have encountered similar problems.

Despite its very small size (195 hectares, part of which has been recovered from the sea) and the fact that state and municipal territory are identical, Monaco has a strong tradition of local self-government, which has a long history and is firmly rooted from a social point of view.

The elected municipal representatives are very close to the Monegasque citizens, who see them as people they can turn to with their everyday problems.

However, only the 7,000 Monegasque citizens have the right to be democratically represented in local public life, whilst the other 24,000 or so residents are entitled to vote in local elections or, for that matter, in national elections.

The fundamental legal instruments which govern local self-government are the Constitution of 1962 and the Municipal Organisation Act (No.959) of 1974 (Appendix II). This act refers in particular to the areas of responsibility of the municipality, to its organs – the Municipal Council, the Mayor and his/her deputies – to their duties and powers, and to staff and municipal finances.

In addition to these instruments, there is an Order concerning municipal finances and there are regulations governing local government officers.

III. GENERAL FEATURES OF LOCAL DEMOCRACY

Monaco is unusual in that it is a "micro-state" with just one municipality. This has a heavy impact on the functioning of local democracy in Monaco. Before considering whether Monegasque local democracy is in conformity with the principles enshrined in the European Charter of Local Self-Government, it would be useful to describe Monaco's unique situation in greater detail.

With an area of about two square kilometres and a population of some 30,000, Monaco could be a "city-state", ie an entity which (like certain German Länder, Swiss cantons and constituent entities of the Russian Federation) merges state and municipal duties. But in the case of the Principality, the distinction between state and municipality is maintained.

The municipality functions in a special way.

Given that there is only one municipality, the dialogue between the municipal and state authorities takes place face to face: relations are direct, close and exclusive. As the state has only one opposite number at municipal level, administrative supervision and financial assistance can take place without red tape and on a case-by-case basis.

There is no distinction between voters at local level and those at State level.

This situation has caused some concern, particularly in connection with the election of the local authority, which in Monaco is more democratic than the national authorities. A solution to this problem could be to allow the three-quarters of the resident population who do not have Monegasque nationality to participate in local elections

The beneficiaries of the activities of the state and of local services are identical. Hence, there is no conflict of interest or any need for the state to arbitrate between individual territories or populations.

There is at least the potential for some competition or duplication. But for the moment, at any rate, the atmosphere is one in which the local and national authorities co-operate and interact closely to achieve joint objectives. It is to be hoped that in the future, good personal relations will no longer be the only way of guaranteeing local self-government and that legal safeguards will be introduced once and for all, notably in connection with the concept and scope of local self-government.

The fact that the state services deal with a single municipality helps make them more attentive, which is a positive element as far as the assistance provided is concerned, but the supervision of municipal self-government may sometimes be oppressive.

Owing to Monaco's small size, the state is as close to the population as the municipality is. The usual criteria for a division between the "local" and "central" levels do not apply in the same way as in a larger state.

In practice, however, the Monegasque local government has features that distinguish it from the Monegasque state authorities.

The deliberating body, ie the Municipal Council, is made up of 15 members elected for four years. It is constituted following elections in which only Monegasque citizens may vote and is composed of citizens who hold office on an honorary basis (alongside their professional activity); ties with the population are very close, since the main purpose of the municipality's powers is to provide services that directly benefit citizens.

The Municipal Council's powers are set out in the Municipal Organisation Act1, which also provides that the Council may express its wishes in connection with other matters of municipal interest that are decided at national level. The act specifies cases in which the Minister of State must consult the Municipal Council, notably in matters of regional and town planning.

The Municipal Council elects from among its members a Mayor and Deputy Mayors, who together make up the Municipal Government. The Mayor is responsible for enforcing the decisions of the Municipal Council. The above-mentioned act enumerates other powers as well. The Mayor is also the representative of the central authorities, and in that capacity he/she must enforce the laws and regulations and perform certain duties, such as administering the municipal police.

The public duties of the state and the municipality are separate, although there are a number of links (the municipality has a staff of 400, the state 1,700).

Many services which in larger states are traditionally a matter for the local authorities remain within the purview of the Monegasque state: town planning, the public water supply, the disposal of household waste, etc. The social welfare and public health sector is the responsibility of specialised state bodies in which the Municipal Government is represented. In these fields, the municipality has only a consultative role, in respect of certain decisions affecting it.

Monaco does not have direct taxes at municipal or state level, and so the municipality's own resources (essentially from various indirect taxes) cover only a small percentage of municipal expenditure (about 25%). In figures, this percentage - given that the budget of the city of Monaco amounts to about 12% of the national budget (approximately 400 million out of a national budget of about 3 billion francs) – works out at about 100 million francs.

The lion's share of the resources comes from a state grant (Article 87 of the Constitution). The grant distinguishes between resources corresponding to ordinary expenses in the previous financial year, which are renewed virtually automatically, and those corresponding to new or "extraordinary" expenses, over which supervision with regard to expediency is exercised.

IV. CONFORMITY WITH THE PRINCIPLES SET OUT IN THE EUROPEAN CHARTER OF LOCAL SELF-GOVERNMENT

The existence of a Monegasque municipal body is fundamentally consistent with the principles of local democracy as enshrined in the instruments of the Council of Europe.

In a number of areas, however, the situation of local democracy in Monaco is not in conformity with the terms of the European Charter of Local Self-Government.

It can be conceded that certain "discrepancies" are associated with Monaco's special situation and must therefore be maintained.

Others have a more or less formal character and have to do in part with the fact that the Monegasque Municipal Organisation Act is 25 years old and needs to be reformed to keep step with the general development of local-government law in Europe.

Major divergences from the Charter might serve to promote greater efforts to bring about a more radical reform of Monegasque local democracy.

Conformity of Monegasque legal instruments with
Part I of the Charter

- Article 2: Constitutional and legal foundation for local self-government

The principle of local self-government is not mentioned in the Constitution and is only partially recognised by the Municipal Organisation Act, which in section 25 specifies that "the Municipal Council shall consider municipal matters".

As part of an amendment to this act (or even to the Constitution), it might be appropriate for the Monegasque authorities to make the principle of local self-government an aspect of positive law.

- Article 3: Concept of local self-government

    . paragraph 1:

    By law, the municipality of Monaco regulates and administers, under its own responsibility, a considerable proportion of public affairs. However, the municipal budget is too small in view of the relatively weighty municipal responsibilities, especially where the municipality's own resources are concerned.

    Given that the municipal framework is more democratic and participatory than that of the state, it would be worth giving consideration to an additional transfer of powers. In the specific case of Monaco, the purpose of such a transfer would not be to "decentralise", because the state services are no more "centralised" (geographically) than those of the municipality. Powers would be transferred because the latter has a structure that is closer to the population owing to the role of the Municipal Council.

    Such a transfer might concern services in respect of which greater citizen involvement is desired (for example town planning, sorting of urban waste).

    . paragraph 2:

    The Monaco Municipal Council meets these requirements.

- Article 4: Scope of local self-government

For the most part, these provisions do not pose any difficulties for Monaco. However, it should be pointed out that the Municipal Organisation Act is vague about the definition of the municipality's powers, in that it refers only to "municipal matters".

Paragraph 3 poses a problem of interpretation for Monaco because the state services are not geographically further away from citizens than municipal services. But this provision can also be understood in the sense of "functional" proximity. In that case, it would also have significance for Monaco.

- Article 5: Protection of local authority boundaries

This provision is hardly relevant to Monaco, at least at present.

- Article 6: Appropriate administrative structures and resources for the tasks of local authorities

This provision raises the question of whether the municipality of Monaco is truly independent in the organisation of municipal services, since the state supervises the organisation chart and the recruitment of new municipal employees (section 53, paragraph 2, of the Municipal Organisation Act).

- Article 7: Conditions under which responsibilities at local level are exercised

The power to dismiss the mayor and the deputy mayors and to dissolve the Municipal Council, which the Municipal Organisation Act gives the executive, (sections 24 and 36) does not appear to be in conformity with paragraph 1 of this article of the Charter. In practice, dismissal is unlikely, but it would be preferable, as part of a reform of this legislation, either to rescind this power or to make it contingent on specific conditions and a procedure which fully guarantees the right to a fair hearing.

- Article 8: Administrative supervision of local authorities' activities

This provision may pose difficulties because, in principle, it allows only a review, by the state authorities, of compliance with the law (except where state duties are delegated to the municipality, which does not appear to be the case in Monaco).

The Monegasque Municipal Organisation Act provides for a degree of supervision with regard to expediency (section 28). Monaco should give thought to amending the relevant legislative provisions, particularly as supervision poses little difficulty in practice, and might take a different, less stringent form without too much inconvenience.

- Article 9: Financial resources of local authorities

    The provisions on financial resources are only partially applicable to the Monegasque situation. The annual state appropriation is the municipality's main resource; this limits its freedom of initiative, because its own resources are not adequate within the meaning of Article 9, paragraph 1. The Monegasque situation is not consistent with Article 9, paragraph 3, because the municipality does not levy local taxes of which it has the power to determine the rate. The part of the state appropriation earmarked for extraordinary expenses can be regarded as a special grant within the meaning of paragraph 7. Lastly, the municipality has no access to the capital market as provided for in paragraph 8.

    Ratification of the Charter could give Monaco an opportunity to strengthen the municipality's financial independence. One solution, for example, would be to allocate the municipality a given percentage of VAT, whose level it could fix. That way, the grant awarded to allow the municipality to balance its books – a grant in respect of which the state exercises supervision with regard to expediency - would be much less sizeable.

- Article 10: Local authorities' right to associate

At present, the right of the municipality of Monaco to co-operate with foreign municipalities is contingent on government authorisation (section 25, last paragraph); this is at variance with Article 10, paragraphs 2 and 3. The law should allow Monaco's local authorities to establish direct relations with local authorities in foreign countries.

- Article 11: Legal protection of local self-government

Monaco appears to comply with these provisions, although the municipality has hardly ever contested a decision of the state services before a court.

V. CONCLUSION

Monaco's accession to the Council of Europe should be accompanied by an undertaking to ratify the European Charter of Local Self-Government, whose implementation does not pose fundamental problems but might necessitate revision of Monegasque legislation on municipal organisation.

Such a review should be designed to:

1) enshrine the principle of local self-government in law, define the scope of this concept in the Monegasque framework and broaden its ambit through a transfer of power in a number of areas, notably town planning and administrative structures;

2) reduce administrative supervision of the acts, staff, budget and organisation of municipal administrative services; limit this supervision to a review of compliance with the law; and eliminate supervision of persons except in limited cases specified by law in connection with court proceedings;

3) give the municipality greater latitude to organise itself internally so that it can decide on its own administrative structures and recruit qualified staff on the basis of the principles of merit and competence;

4) bolster the municipality's financial resources, in particular the proportion of its own resources of which it may dispose freely within the framework of its powers. To this end, the municipality of Monaco should be allowed access to the national capital market in order to finance its investment expenditure.

Moreover, it is unacceptable that three quarters of Monaco's residents should be excluded from local public life. The participation of these residents in local public life could help facilitate their integration and make the decision-making process more democratic, at any rate at local level. In this connection, the Monegasque state should ratify the Council of Europe's Convention on the Participation of Foreigners in Public Life at Local Level with a view to introducing alternative forms of participation in the democratic life of the country for the part of the population that does not have Monegasque nationality.

With regard to relations beyond the borders the state of Monaco should ratify the European Outline Convention on Transfrontier Co-operation between Territorial Communities or Authorities (the so-called Madrid Convention) so that the municipality of Monaco can have a legal framework for establishing formal relations with local authorities in foreign countries.

APPENDIX I

Programme of the visit of a delegation from the Congress of Local and Regional Authorities of Europe to the Principality of Monaco

Thursday, 17 December 1998:

    11.35

or 12.05 Arrival of the delegation at Nice Airport

        Transfer to and welcome of the delegation at Monaco heliport

1.00 pm Lunch given by the State Minister, Mr Michel LEVEQUE, in the presence of Ms Anne-Marie CAMPORA, Mayor of Monaco

3.30 pm Meeting with the Municipal Council, followed by a cocktail

5.00 pm Transfer to the Hermitage Hotel (departure from the Town Hall on the Town Hall Square side

8.30 pm Dinner given by the Mayor of Monaco, "Excelsior Salon", Hermitage Hotel

Friday, 18 December 1998:

9.45 am Departure from Hermitage Hotel

10.00 am Presentation of major spatial planning works in the Principality of Monaco by Mr Gilles TONELLI, Director General of the Department of Public Works and Social Affairs

11.00 am Meeting with Mr Philippe DESLANDES, Government Counsellor for the Interior

12.30 pm Lunch given by the Directorate of Foreign Affairs at the Grill of the Hôtel de Paris

2.45 pm Visit of the Exotic Gardens

        Christmas Tree at the Town Hall of Monaco

NB: In the afternoon and evening, departure and transfer of persons leaving Nice, according to their flight schedules.

1 These powers include: adopting the budget, fixing certain taxes, administering the architectural heritage, establishing the organisational structure of the municipal services, dealing with questions of public health and urban pollution, creating, eliminating and modifying green zones and administering cemeteries, nurseries, libraries, sports facilities and local cultural activities.



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