With support from the Accountable Governance for Basic Service Delivery Project (AGBSDP), the Fiscal Decentralization Division (FDD), Ministry of Finance in collaboration with the Ministry of Local Government on Friday July 26, 2024, ended three regional level Local Revenue Forums with the theme: “Unlocking the Challenges to Local Revenue Mobilization”.
The regional fora which were held in Makeni, Port Loko and Bo, respectively, brought together Mayors, Chairpersons, Chief Administrators, Finance Officers of City and Local District Councils, Paramount Chiefs and Chiefdom Coordination and Administration Clerks, District Officers, Permanent Secretaries of Local Government, Environment, Forestry and Climate Change Ministries. In attendance of the Local Revenue Forum as technical and resource persons were Senior Deputy Financial Secretary, the Director of Policy and Research Ministry of Finance, Directors of FDD, Decentralization and Local Government, reps from the Mines and Mineral Resources and National Mineral Agency amongst others.
In his overview, the Director of FDD, Mr. Adams Kargbo said the Forum is organized to discuss challenges faced by Local Councils in generating own source revenue and to proffer recommendations to boost local revenue mobilization for Local Councils to be able to adequately perform their mandates. AGBSDP considers revenue mobilization as key to local service delivery.
As a background, there have been several interventions and arrangements to enhance revenue mobilization, but these arrangements got stalled and the reason all these challenges should be discussed and proffer solutions.
Overall, the revenue mobilization situation of Local Councils across the country is not good; it is nothing encouraging to write home about. Based on the amount of own source revenue collected by certain Councils, it is far less than what is required to provide a single basic facility for its localities, according to FDD’s presentation on the Councils’ overall revenue records for years ago until now.
During all three opening sessions and while declaring the Local Revenue Forum officially open, the Deputy Ministry of Local Government, Mr. Alfred Moi Jamiru said local revenue mobilization is faced with huge and numerous challenges and the issues should be critically discussed. He therefore entreats participants to proffer recommendations and clear pathways of collaboration amongst concerned local authorities, the supervising Ministry and other ministries charged with collection of related revenues. “Paramount Chiefs and District Officers are pivotal in revenue mobilization. Unlocking the challenges of revenue mobilization requires robust collaboration, coordination and enhanced interpersonal relations between the Local District Councils and Chiefdom Authorities,” said the Deputy Minister, Mr. Alfred Moi Jamiru.
Deputy Minister, Mr. Alred Moi Jamiru (Center)
He added that at the central political front, there are as well lots to be done and it is hoped that after the three days frank deliberations, the highlights of key issues raised, agreed action points and recommendations would be presented to the Inter-ministerial Committee for further actions. He said as a country, we must move forward with a spirit of collaboration, innovation and commitment to build a prosperous future.
Whiles laying the basis for the local revenue forum, the Senior Deputy Financial Secretary Ministry of Finance, Mrs. Mariatu Browne intimated that Local Councils contribute about 10% to their budget which means they largely depend on the central Government for budgetary support. This, according to Browne, is caused by lots of challenges recorded in the collection/mobilization of local revenues like local tax, property tax, mining revenues and forestry tax.
“Revenue leakages remain as significant challenge in resource mobilization within local councils, and conflicting laws,” she said.
Mrs. Browne urged local revenue stakeholders to explore and diversify revenue sources and should be complimented by innovative levies. She noted that the task is not easy, but it is essential and doable to drive development at the grassroot level.
She informed the local government stakeholders that the Accountable Governance project has supported the development of revenue mobilization strategies for five Local District Councils which are to be rolled out and will be supporting nine other Local Councils on same. She said the Ministry is at an advance stage to develop a fiscal strategy which would immensely support both central and local revenue mobilization.
In synopsis of local revenue mobilization challenges, the Project Coordinator of Accountable Governance Project, Adams Tommy who is a Taxation expert, emphasized six key issues that should be critically discussed to guide deliberations on local revenue mobilization of the Councils. The issues he highlighted are as follow:
- What amount Local Councils are reporting versus what is collected – as there is difference between what is collected and what is reported as revenue.
- The need for thorough analysis of how Councils’ own source revenues collected contributes to salaries of Local Council staff, how those moneys are being expensed on allowances (rent and responsibilities) paid to core staff of Councils.
- What is the relationship between transfers of Chief Administrators and Finance Officers and revenue mobilization – as it is has been observed that in Councils where chief administrators and financial officers are upright, revenue mobilization is seen to be boosting, but the sooner they are transferred, revenue collection drops.
- The ownership of markets – and who should be collecting market dues?
- What is the relationship between election years and revenues reported at Local Councils?
- Processes involved in collection of local tax are all part of the bottlenecks to local revenue generation.
Mr. Adams Tommy said these are administrative bottlenecks that are affecting revenue collection at Councils. “These are facts that should be said as the only way progress could be made.
PC Fasuluku is the Chairman of Councils of Paramount Chiefs. In his response to challenges of local revenue generation on behalf of Chiefdom administration, alluded that discussions on local revenue mobilization are indeed interesting and should not only end at the local revenue forum. He said Chiefdoms have no qualms with arrangement of revenue sharing with Local Councils. He however, pointed out that the relationship between the Local District Councils and the Chiefdoms has not been cordial with regards revenue mobilization. He said although there are lots of economic activities that are going on within their chiefdoms, the Chiefdom authorities have no knowledge on taxes generated from those revenue sources.
Agreed action points from the deliberations include identification of conflicting policies, laws and repeal where necessary, upgrade of cadastral system and rollout nationwide, capacitating of evaluators, strengthening transparency and accountability – rollout of PFM Smart and publish own source revenue collection quarterly, boundary review and delineation, timely printing and distribution of local tax receipt books. Institutionalization of processes and systems for revenue mobilization, introduction of digital systems, technologies, enhanced collaboration with the private sector, citizens’ engagement, transparency in revenue collection, utilization of taxes and fees, amongst others.
As next steps, the above action points and recommendations will be fine-tuned and presented to the Inter-Ministerial Committee (IMC) for concrete actions to unlock those numerous challenges local revenue mobilization is faced with across the country and thereby boosting local revenue generation.
By: Aruna Augustine Kamara
Communications Specialist,
Accountable Governance Project.