This Policy Note distils the findingsand recommendations of a Study, jointly undertaken by theWorld Bank and the Government of Timor-Leste, that evaluatesthe mechanisms used by the Government to manage sub-nationalspending in recent years: i) the Local Development Program(Programa Dezenvolvimentu Lokal, PDL), underway since 2004;and ii) the Referendum Package (Pakote Referendum, PR),initiated in 2009, and progressively refined as theDecentralized Development Program (Programa deDezenvolvimentu Desentralizadu, PDD) since 2010. The Studyassesses how these programs have performed in respect of anumber of key government policy priorities and drawsconclusions and lessons for the future. It adopts a dynamicapproach, so as to adequately acknowledge and account forhow shifts in the government s policy priorities over time,in response to the changing context, were reflected in theinstitutional arrangements that govern sub-national spending.