These two terms are often used interchangeably, but they have different meanings.
What is Local Governance?
Local governance is defined as the “public administration of towns, cities, counties, and districts.” It points to governing or overseeing at a local level, usually in a smaller area.
Role of Local Government
Local government is “a generic term for the lowest tiers of public administration within a particular sovereign state. This particular usage of the word government refers specifically to a level of administration that is both geographically-localized and has limited powers” [Source]. Local governments usually include municipalities, councils, regional districts, and boards. They are in charge of promoting national campaigns and ideas across the country.
These governments can also influence economic development and planning by “Planning and zoning bylaws, Taxation, Local business support, Collaborating between communities and in the larger region, Accessing and using programs offered by provincial and federal governments and Advocating for community economic development priorities with governments and industry” [Source], as noted by British Columbia.
Local governments assist in creating well-paying jobs in the community and improve people’s lives by providing services, aiding social or cultural activities, and establishing environmental or recreational areas. They also inform community members with vital national information, promote economic growth, support businesses, and contact investors.
Characteristics of Local Government
A local government is the third tier of government among the federal and state government. Some define it as the closest government, hence a “grassroots government.” Other characteristics include “a continuing organization; the authority to undertake public activities; the ability to enter into contracts; the right to sue and be sued; and the ability to collect taxes and determine a budget” [Source].
Local governments’ authority usually covers public schools, local highways, municipal services, social welfare at the lower level, and public order within their territory.
Difference between Local Government and Local Self-Government
Under local government, “the administration of a locality is looked after by the officials appointed by the state,” while local self-government is an “institution of locally elected representatives managing the affairs of the locality and providing them with the basic amenities” [Source]. This also means that a local government largely represents the state’s administration while local self-government represents people within a certain area. It is also posited that a local government is state-appointed, and local self-government is “set by local representative bodies directly elected by the local population.”
Because of this view, the local government pushes forward the state’s drive. In contrast, local self-government is built to address issues affecting its community. In terms of ideology, the local government adopts the state’s plan, but a local self-government has the liberty to implement unique ideologies.
Relationship between Local and Central Government
A major linkage between local and central government states that “The power of the local governments derives from the central government’s authorization or decentralization of power. Secondly, while decentralizing the power, the central government withholds the power to manage important state issues” [Source].
A central government is the “government that is a controlling power over a unitary state,” so it is ranked higher than the local government. This means that the local government answers to the central government. A central government can make rules, and a local government has to adopt those rules and implement them in its territory.
Difference between Decentralization and Local Governance
Decentralization is explained as “the transfer of responsibility for planning, management, and resource-raising and allocation from the central government to (a) field units of central government ministries or agencies; (b) subordinate units or levels of government; (c) semi-autonomous public authorities or corporations; (d) area-wide regional or functional authorities; or (e) NGOs/PVOs.” [Source].
Local governance governs a particular area or resources by a local government.
The difference between these two concepts is that decentralization is how central governments give power to local governments, and local governance is part of the decentralization process whereby local governments are given powers to govern on locality levels. Decentralization assigns certain duties to local governments, while local governance executes those duties assigned to local governments.
Decentralization in government is done by the central government, whereas local government officials carry out local governance. Also, decentralization “will be understood as the devolution by central (i.e., national) government of specific functions, with all of the administrative, political and economic attributes that these entail, to local (i.e., municipal) governments which are independent of the center and sovereign within a legally delimited geographic and functional domain.” And local governance is understood from the perspective of having municipalities and councils delivering services to the people while being supervised by the officials in a local government.
Decentralization creates local governments tasked to govern localities. Local governance can decentralize the local government by creating small sections that report to the head of a local government.
Difference between Local Government and Local Governance
Local government is the body of officials elected by the state to oversee the governing process of a locality, while local governance is the actual governing of an area such as a town or a city. The local government tasks its officials to carry out different duties. The officials will perform those tasks, thus locally governing act in action.
Local governance can be seen as the “public administration of towns, cities, counties, and districts,” and local government is the organ that has authority over a locality. The local government is put in place by a state’s administration and given roles. Local governance is when the local government is now fulfilling those roles. Local governments are established after decentralization by the central government and instituted at a lower level as governing boards. They carry out all the local governing by addressing issues at their various localities.
Wikipedia notes that “Governance is all the processes of interactions be they through the laws, norms, power or language of an organized society  over a social system (family, tribe, formal or informal organization, territory or across territories). It is done by the government of a state, market, or network” [Source], thus clearly distinguishing between government and governance.