Assessing the sources and sustainability of funding to Assemblies for local development: comparative analysis of three Selected Metropolitan, Municipal and District Assemblies (MMDAS) in the Upper East Region (UER) of Ghana

Decentralization is a term that refers to the transfer of authority to plan, make policy decisions and to carry out public functions from the national to the sub-national levels This strategy has been given legal backing in the 1992 constitution. Article 35 section 6 (d) enjoins the state to involve ordinary citizens in the decision making process. It states “making democracy a reality by decentralizing the administrative and financial machinery of government to the regions and districts by affording all possible opportunities to the people to participate in decision making at every level in national life and in government.” There are components of Ghana’s decentralization policy. These are political, administrative, development planning, financial and economic. Distribution of financial responsibility is a core component of decentralization. If local governments and private organizations are to carry out decentralized functions effectively, they must have adequate level of revenues – either raised locally or transferred from the central government– as well as the authority to make decisions about expenditures. In the light of this important role, the study identified some sources of funding to the Assemblies and prescribed sustainability measures to improve their internal mobilizations. Fiscal decentralization entails putting in place the structural and regulatory policies on; revenue allocation, inter-governmental transfers and borrowing arrangements; planning and budgeting processes; and financial management arrangements that would ensure the transfer of adequate financial resources from Central Government to local government authorities. These authorities are empowered with the autonomy to allocate these resources in the provision of socio-economic services through composite budgeting. To achieve the set objectives, the study employed a case study approach as the path. Under the case study, purposeful sampling was used to select the three District Assemblies which were Builsa, Talensi Nabdam and Bolgatanga Municipality while systematic sampling derived from probability sampling was used to identify houses in the communities while stratified sampling was used for households identification. The study utilized both secondary and primary data. Primary data were collected by administering questionnaires to respondents. Secondary data were also collected by contacting MMDAs, Regional Coordinating Council, Ministry of Local Government and Rural Development and other relevant Non-Governmental Organizations. The study revealed that there is: low internally generated funds, inadequate training for revenue collectors and tax payers, inadequate motivation for revenue collectors, inadequate data base to aid planning and revenue mobilization and untimely transfer of funds from central government. Following from the findings, the study concludes that all the relevant stakeholders in the revenue chain should be educated in respect to revenue mobilization. The central government should deliberately fashion out strategies to improve the local economies of the less endowed districts

Source: KNUST