Financial control by local urban councils frustrating service delivery

Wednesday December 5 2018

Oscord Mark Otile

Oscord Mark Otile  

By Oscord Mark Otile

At its inception, the concept of transfer of power to lower levels of government under the public sector reform on decentralisation raised hope for improved services, as was its objective. The types of decentralisation included: Political decentralisation, whose aim was to promote citizen participation in the democratic process of Uganda, Fiscal decentralisation re-defining how local governments fund their budgets and mobilise financial resources, and administrative decentralisation, which is more focused on implementation of lawful decisions by a local government council.

Since the adoption of decentralisation in 1993, the performance by government on the service delivery front has not been impressive, in my opinion, particularly in urban councils and yet about 90 per cent of the members of councils in local governments are leaders who subscribe to the ruling National Resistance Movement (NRM) party. Fortunately or unfortunately, social services are neither yellow, blue, red nor green, which represent colours of prominent political parties in Uganda. Poor state of service delivery would affect all citizens alike, regardless of their political party affiliation.

During elections, President Museveni has always asked the electorate to vote in leaders who subscribe to his NRM party, who he says he can work with to cause development. One would, therefore, expect improved service delivery in local governments that are predominantly NRM.

The fact that urban councils are given autonomy over their financial and planning matters in relation to district councils does not help matters with regard to better delivery of public services under the decentralisation policy (Local Governments Act CAP. 243; Section 79). Whereas sub-county councils are required to remit 35 per cent of revenue collected to the district council, urban local councils on the other hand enjoy autonomy even though their plans have to be incorporated in the district plan.

This provision in the Act has given urban councils a sense of being more powerful than the district councils who find it hard to oversee the implementation of lawful council decisions within municipalities and town councils. With all the revenue sources urban councils have at their disposal, the level of service delivery is wanting in most municipalities, characterised by the bad state of roads, irregular garbage and waste management, lack of street lighting, among others.

Even though they have the power to levy taxes, many a local government in Uganda rely on central government transfers, usually more than 95 per cent to fund their budgets, with locally-generated revenue contributing not more than 3 per cent.
According to a report by Acode on the Local Government Council Scorecard Assessment for the Financial Year 2016/2017, local governments are constrained by inadequate revenue generation, which limits their discretion and flexibility to address service delivery gaps at the local arena. The report further stresses the need to explore avenues of increasing revenue generation and recommended a halt to the creation of new municipal councils and town councils.

A glance at the recent funding towards infrastructural development under the World Bank project dubbed Uganda Support to Municipal Infrastructure Development (USMID), further demonstrates how financial autonomy for urban local councils is an encumbrance to effective decentralisation. Jinja Municipality, for instance, like other major municipalities, including Gulu, Lira, and Arua, has had access to these funds, while other municipalities have made progress with works on most of their roads.

Jinja seems to be stuck with a contractor who, after a year, is not showing signs of concluding works on the only street being worked on (Main Street). Most roads in Jinja Municipality are in a bad state and citizens feel betrayed by their elected leaders. While I am not sure of the actual cause of the delay on the road works in Jinja, I am concerned that leaders at the level of the district council have not taken credible steps to intervene on the delay, if at all they did take any action, then they didn’t provide feedback to other stakeholders.

I, therefore, recommend an amendment of Section 79 of the Local Governments Act and propose that urban councils remit to the district council at least 25 per cent of the local revenue collected.

Mr Otile is a researcher with the Advocates Coalition for Development and Environment (Acode).