Despite the importance of local finance and public employment data, significant gaps persist, particularly at the individual municipality and regional levels. This data is valuable information for assessing the capacities of municipalities and regions and for evaluating disparities across and within countries.

To fill-in these gaps, the OECD and EU project “Strengthening analytical frameworks and data on subnational government finance and public employment" seeks to create unique databases with aggregated and disaggregated data on public finance at regional and municipal government levels (REGOFI and MUNIFI), as well as a pilot database on subnational public employment with a focus on gender. 

Subnational governments play a key role in advancing the broader environmental agenda. In the context of climate emergency, it becomes essential to deepen our understanding of their fiscal responsibilities in the environmental transition. 

This involves closely monitoring the progress of regions and cities towards the objectives set forth in the Paris Agreement and other environmental initiatives. It also involves identifying sectors that require further actions to ensure their expenditure, investment, and revenues with their ecological ambitions.

Subnational governments play a key role in public investment, especially in infrastructure, directing resources to areas vital for economic development and well-being. On average, they account for 55% of total public investment in OECD countries. 

When well-managed, public investment is a catalyst for the growth and development of regions and local governments. A place-based approach to investment with effective multi-level governance systems enables countries to maximise investment returns and support regional development.

Subnational governments provide essential infrastructure for economic development and well-being in regions and cities. They bear the responsibility for sectors such as education, transport, housing, social services, and utility infrastructure. 

To ensure high-quality, resilient, and inclusive infrastructure, subnational governments require access to sufficient funding and financing for investment and maintenance purposes.