Mobilization of financial resources for development in West Gonja District, Ghana

Government of Ghana has been making some efforts to decentralize political and administrative power to local government. This attempt has been enhanced by the promulgation of the Local Government Law (PHDCL 207), in 1988 which forms the basis of the present Government’s decentralization effort. Under this law, District Assemblies will perform administrative functions as well as act as catalysts for the development of their territory, the responsibilities entrusted to the district assemblies are enormous but the means of achieving them is limited, that is, limitation of manpower (skilled), material and financial resources are paramount, but are essential ingredients for their efficient and effective performance. The major problems many of these local bodies face including West Gonja District, is how to raise sufficient financial resources in order to provide those basic public services. Problems of inadequate financial resources are a result of several interrelated factors that broadly include poor revenue collection system and also general negative attitude of the people towards taxation. In order to make an in-depth analysis of existing and potential sources of finance of the West Gonja District Assembly was undertaken; interviews conducted with assembly officials and residents to identify more development problems and potentials. The revenue sources and expenditure pattern as well as the process and relationship between the planning and budgeting were examined to assess their adequacies for increased financial resource mobilization. The findings of the study can be summarised as follows: * The District Administration lack direct control over line agencies in the district, the result of which is lack of integration and coordination of sector activities. * Planning is not done in the district, that is, perspective and medium term plans which will provide framework for short—term action. As a result, .the selection of project is adhos. • The District Assembly budgetary estimate is unbalanced between revenue and expenditure.. As a result actual expenditure tends to be over the actual revenue. * The District Assembly’s revenue has been unable to collect a greater percentage of its share tax. This indicates that tax collection is characterised by problems such as tax administration being poor; unskilled revenue staff; the lack of reliable nominal rolls and tax register; corrupt tax officials some of whom are alleged to embezzle public funds coupled with high tax evasion. * The district spends much of its revenue on administration particularly salaries and wages, treasury unit, travelling and transport (maintenance and running cost of assembly’s vehicles). On the other hand, development gets very little and certainly what the people export are never met. * The ratio between administration and development expenditure is 90:10 percent in favour of administrative expenditure at the expense of development. * People in the district are willing to pay tax as their civic obligation. Some evade payment because their incomes are very low and they do not see the benefit for them directly. * The community initiative and participation to fulfil their basic needs is high and they need some extra direction and guidance from local government, non government organisations in the choice at projects of relevance to them.

Source: KNUST