Fiscal resource mobilisation and management for local level development - a case study of Mpohor-Wassa East District in Ghana

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The Provisional National Defence Council (PNDC) government has introduced further reforms in the decentralisation efforts in Ghana through the promulgation of the Local Government Law, 1988 (PNDC Law 207). By the law the district assemblies are responsible for the overall development of their areas. Since development cannot be achieved without finance, the law also gives administrative and financial powers to the assemblies. The responsibilities given to the district assemblies are enormous but the means of achieving them are limited. Skilled manpower, material and financial resources are scarce in view of the tasks entrusted to them. Using Mpohor-Wassa East District as a case study this work focuses on how fiscal resources could be mobilised and managed efficiently and effectively for local level development. Main areas investigated included the existing and potential sources of revenue, the expenses on local revenue collection, revenue stability, the expenditure pattern, financial ability and how to ensure that the people benefit from development activities. The study relied on both primary and secondary sources of data. The analytical method involved simple descriptive statistical tools such as percentage and coefficient of variation. The major findings of the study include the existence of enormous socio economic potentials for revenue, poor revenue collection system and expenditure control. The poor revenue collection system was the result of unreliable data base on taxable people and magnitude of each revenue source, unskilled revenue collectors, poor transportation and high rate of embezzlement of collected revenue by the collectors. People were also unwilling to honour their tax obligations because they could see no link between payment and benefits. Due to poor expenditure control, the administrative expenditures were characterised by overspending of estimated targets. On the basis of these findings, recommendations aimed at enhancing fiscal resource mobilisation and management for local level development was made. These include increasing own-source revenue, reducing ineffective expenditure, ensuring that the people derive the required benefits from revenue collected and increasing external sources of revenues. It was emphasised that the District Assembly should rely heavily on its independent own possibilities which are within its control rather than external sources which are outside its influence.
A thesis submitted to the Board of Postgraduate Studies, Kwame Nkrumah University of Science and Technology, Kumasi, in partial fulfilment of the requirement for the award of the Degree of Master of Science in Development Planning and Management, 1992