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85% of local gov’t budget expected from donors

Hajia Alima Mahama
Hajia Alima Mahama

Parliament has, by consensus, approved a total of GhS321million as annual budget for the Ministry of Local Government and Rural Development, and as it turns out, some 85 percent of the amount is expected from donor sources.

Whether donors will release the funds, meanwhile, is contingent on the government of Ghana providing counterpart funding, which has been in arrears to the tune of US$40million, under the District Development Fund (DDF).

Worse still, the DDF is expected to end this year, and the parliamentary committee on Local Government and Rural Development is worried funding challenges may arise after 2017.

The DDF is supported by a number of foreign agencies, including the Agence Francaise De Developpement (AFD), the Canadian Development Agency, the Danish Development Agency, the German Development Bank, as well as counterpart funding from the Government of Ghana

It was instituted to augment what assemblies get from the District Assemblies Common Fund, based on their performance.

Addressing a plenary session on the floor of parliament, Vice Chairman of the local government committee, Kwasi Boateng Adjei, expressed worry over the heavy dependence on donor support.

“The Committee was informed that the donor support for the District Development Fund (DDF) will end in 2017 and this may negatively impact the ministry’s ability to realise its objectives after 2017. The committee is, therefore, urging the ministry to liaise with the Ministry of Finance to explore other sources of funding to support its activities.” the committee’s report noted.

Particularly worrying for the parliamentarians is the fact that counterpart funding from the government for the District Development Fund has an outstanding arrears of US$40million, which is not captured in the 2017 budget to be cleared.

Government’s failure to provide for the counterpart fund implies the ministry would not be able to draw down on the donor support under the DDF.

Furthermore, the report also observed an increased allocation for compensation between 2016 and 2017; whereas the total expenditure for compensation for 2016 was GhS14m, it went up to GhS18m in 2017, representing an increase of GhS3,591,328 or 25percent over the 2016 expenditure.

Meanwhile, the ministry intends to implement a number of activities this year, including providing formal training for 1,500 youth in technical and vocational education, training 450 technical instructors on TVET reforms by August 2017, completing the construction and rehabilitation of 101 feeder roads and also rehabilitating 67 small Earth Dams in rural communities under the Ghana Social Opportunities Project.

It also intends to provide inputs (fertilisers, seedings,etc) to at least 4,000 farmer groups and other actors along the agriculture value chain under the Social Investment Fund(SIF)/Integrated Rural Development Project(IRDP) and Expand the Community Population Registration Programme in 30 communities by establishing Registration Centres in 26 communities.

For the outlook for this year, the ministry told the committee members that it intends to pursue strategies aimed at resolving district boundary disputes in the country to ensure co-existence and improve revenue mobilisation by the affected MMDAs. This includes the implementation of the Benin Committee’s Report on District Boundary Disputes.

The Ministry will also seek to review relevant legislations to provide for the election of MMDCEs.

For the 2016 financial year, a total amount of GhS228,655,075 was approved for the ministry, out of which GhS200,758,406.72 was expended, leaving a balance of GhS27,896,668.28.

Source: B&FT