This article focuses on one of the most important principles of government centralization and decentralization. This principle is reflected in the organization and functioning of political, territorial and resource characteristics of the state. The analysis of the trends and criteria for the federal and regional levels of government, the means of establishing a volume of competence of state bodies and guarantees of their independence are shown in the article. The article assesses the factors of "displacement" and distorted competition; considers characteristic modes of interaction and relationship with businesses; reflects a historical process of the formation of decentralization and centralization from the Soviet period and up to the present time. It defined criteria specific to decentralization and centralization; reflected their differences; briefly revealed the essence of the criteria for centralization. Centralization ensures the integrity of the state system and the "full" consolidation of its elements, the concentration of decisionmaking at the top levels of government, the concentration of financial, material, information and other resources, etc. Decentralization can be characterized by the approach of the subjects of management (bodies) to the managed objects (spheres, industries, organizations),by a kind of direct communication; by autonomy in matters of their competence and the availability of necessary resources of their own; by the responsibility for their enforcement actions and the results obtained; by their close relationship with the population of cities, districts and rural settlements; by their decision making. Identified criteria for centralization and decentralization can detect the necessary transformation of government and the essence of competence at various levels of decentralization and centralization. The paper analyzes a number of laws and regulations, found a number of those vaguely worded; shows the ways to solve this problem; identifies various contradictions in the definition of competence, and provides a number of criteria identified in practice.

It also identified a number of modes of interaction of the state and business, i.e. guide and subordination; legal regulation; soft ware and target orientation; government support; making suggestions ( coming up with initiatives) and their considering in the form of rules, regulations, which are necessary for taking into account the opinion of the author in this rapidly changing world.