Commonwealth Local Government Forum

Local government finance

Resourcing local government remains a central challenge to effective decentralisation. This section has content relating to different models of fiscal decentralisation, options for identifying new sources of local revenue, such as local property tax; and strategies for improving collection and deployment of own-source revenue. It also offers information about improving the borrowing potential of local government, innovative financing models such as municipal bonds, shared services, and public private partnerships.

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Mobilising internally generated funds to finance development projects in Ghana’s Northern Region

This paper assesses the effectiveness of Metropolitan, Municipal and District Assemblies (MMDAs) in Ghana’s Northern Region in mobilising internally generated funds (IGF) to finance development projects. The study gathered both primary and secondary data from three MMDAs: Tamale Metropolitan Assembly, Yendi Municipal Assembly and Saboba District Assembly. It employed a multi-stage sampling technique of questionnaires, interviews, focus groups and key informant interviews to collect data from respondents and obtain a snapshot of their situation in the 2013 fiscal year. It established that fines, property rates, licences, annual rates, investment income, permits, sales of tender documents, and business taxes were potential sources of revenue for the assemblies. Also, the study identified a range of strategies employed by assemblies to raise revenue: engagement of revenue collectors, use of a mobile revenue taskforce, registration of businesses, visits to markets and business centres, commission payments for revenue collectors, security checkpoints, incentivisation of revenue collectors, establishment of revenue collection points, and rotation of revenue collectors. Nevertheless, the study found that the MMDAs studied could not meet their IGF revenue targets for the 2013 fiscal year, with all three falling below 50%. This poor performance was attributed to: inadequate logistics to support effective IGF mobilisation; under-declaring of revenues; not enough revenue collectors; poor supervision and monitoring; poor compliance by ratepayers; corruption; political interference; inadequate knowledge and skills among revenue collectors; poor service delivery by the assemblies; ineffective collaboration; and lack of revenue data.

Author: Felix Puopiel, Musah Chimsi Publisher: University of Technology Sydney Press Publication year: 2015


Municipal infrastructure financing innovative practices from developing countries - book review

Review of the book: "Municipal Infrastructure Financing Innovative Practices from Developing Countries" edited by Munawwar Alam

Author: Kevin Tayler Publisher: University of Technology Sydney Press Publication year: 2011


An assessment of rate-pegging in New South Wales local government

Rate-pegging has been in place in NSW for more than thirty years with broad support from all sides of politics. However, in late 2008 the NSW Government commissioned IPART to report on the adequacy of rate-pegging. IPART produced a Draft Report and then a Final Report, which has not yet been released by the NSW Government. Nevertheless, the NSW Government has made some changes to local government finance by way of capping developer charges, allowing IPART to make annual rate-pegging determinations, and enabling IPART to consider special variations in rate-pegging. Against this background, this paper considers the principles and practice of rate-pegging in NSW, the rationale for rate-pegging and counter-arguments on its desirability, as well as its economic effects on NSW local government finance relative to other Australian local government jurisdictions.

Author: Brian Dollery, Albert Wijeweera Publisher: University of Technology Sydney Press Publication year: 2010


Role of local government in Botswana for effective service delivery: challenges, prospects and lessons

This paper begins with an explanation of the nature of local government in Botswana, its structures, and their functions and accomplishments since independence. It then proceeds to look at the challenges, and considers measures for meeting them. It ends by looking at future prospects and draws some lessons.

Author: Keshav C. Sharma Publisher: University of Technology Sydney Press Publication year: 2010


Financing Local Government

Decentralisation is now taking place in the public administrations of most countries of the world. A critical determinant of the effective performance of local governments is finance – their ability to both mobilise financial resources and to use those resources effectively and efficiently.

This book explores the variety of methods used to ensure that fiscal decentralisation takes place alongside administrative decentralisation. It considers the range of revenue sources available, the design systems of intergovernmental transfers between central and local government, and the kinds of rules and procedures necessary to ensure that local governments use their financial resources appropriately.

The experiences described in this book will help local government managers, and national policymakers charged with local government finance issues, to ensure that they follow good practice in their own programmes of local government reform.

Author: Nick Devas with Munawwar Alam, Simon Delay, Pritha Venkatachalam and Roger Oppong Koranteng Publisher: Commonwealth Secretariat Publication year: 2008


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