Local government leaders want the government to reform the policy on local revenue collections and in effect improve service delivery at the local level.
Through their umbrella association, Uganda Local Government Association (ULGA), local leaders have asked the government to use the ongoing review process of the decentralization policy to consider establishing and implementing a national local revenue mobilization policy and strategy.
“There are legal frameworks especially among key central government institutions such as Uganda Revenue Authority (URA), Uganda Wildlife Authority (UWA), National Forestry Authority (NFA) and others that are not in tandem with the Local Government Act making enforcement of local revenue collection difficult. We act as agencies for tax collection but the agency fees prescribed by law are never given to us,” said Patrick Kayemba, ULGA vice president (Eastern).
He called for the implementation of a fiscal decentralization architecture based on vertical sharing. This, Kayemba argued, would bridge the funding gap since government hasn’t warmed up to ULGA’s continued advocacy to increase the allocation of national budget share to local governments.
“The budget allocation to local governments over the years has consistently declined. For example, the budget share for local governments from the national budget reduced from 19.5 percent in 2009/2010 to 9 percent in the current financial year. Moreover most of this budget is allocated for recurrent costs; almost 74 percent covers unavoidable statutory expenses which include salaries, gratuities, pensions and other emoluments,” Kayemba said.
He also called for a review of the national local economic development policy to empower local governments to attract and invest in projects that boost local economic developments to generate local revenue to contribute meaningfully to service delivery in their localities.
The proposal follows a survey report that revealed a significant reduction in revenue collections across all local governments in the country due to the Covid-19 lockdown.
The report by Action Aid Uganda revealed that overall, only 54 percent of the districts posted a 5 percent increase in their revenue collections.
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