Decentralization, as a policy option, has been on ghanas political agenda since independence. Government of ghana intergovernmental fiscal decentralisation framework english the primary goal of this framework is to provide a comprehensive road map which has broad based support for the vision of fiscal decentralisation as well as the strategies to meet that vision. While measuring decentralization is equally complex, the fiscal flows to, from and among different levels of government can be used assess some aspects of fiscal decentralization. The story of decentralisation in ghana is an interesting one. The composite budget of adaklu district assembly for the 2015 fiscal year has been prepared from the 2015 annual action plan lifted from the 2015 2017district medium term development plan dmdtp which is aligned to the ghana shared growth and development agenda gsgda, 2015 2017. It comprises the assignment of responsibilities, including sectoral functions, as well as the assignment of ownsource revenues to subnational governments smoke, 2003. Reforms happen for different reasons and never start with a blank slate, meaning that reforms must be adapted to the existing institutional context. Aug 05, 2017 fiscal decentralization constitutes the public finance dimension to decentralisation in general, defining how and in what way expenditures and revenues are organised between and across different levels of government in the national polity. The second part of the morning will introduce fiscal decentralisation and own revenues as a way to strengthen. Fiscal decentralization has gained support by most of the worlds leading development organizations including the world bank, united states agency for international development and. What is decentralization and explain its advantages and. Fiscal decentralization involves shifting some responsibilities for expenditures andor revenues to lower levels of government. The views expressed in this publication are those of the authors and do not necessarily reflect the views and policies. Ghana inherited the decentralization policy as a legacy of british policy of the indirect rule.
Decentralization is a complex phenomenon involving many geographic entities, societal actors and social sectors. Practices and challenges of fiscal decentralisation in africa. Members stay in office until the presidents term ends. Fiscal decentralization in south africa fiscal division of powers as demonstrated in table 16. Reducing poverty through fiscal decentralization in ghana and beyond. The council of state includes a former chief justice of ghana, a former chief of the defense staff, a former inspector general of police and the president of the national house of chiefs. Nevertheless, after nearly three decades of implementing decentralisation, which has generated rather elaborate structures and processes, ghana still struggles to realise. Fiscal decentralisation under the district assemblies common fund dacf in ghana is supposed to transfer more financial resources from the centre to the districts, and to. It is structured into a number of parts as follows. This can be illustrated by considering the use of a head tax. In a unitary state, the head tax does not distort economic decisions. Government of ghana intergovernmental fiscal decentralisation framework. Post independence era problems that developed as a result of this dual central and local administration included encroachment on the rights and responsibilities of the weaker local.
This fiscal decentralisation paper forms part of a series of introductory guides on key. Distribution of conditional transfers contents acknowledgements 3 1. Impact of fiscal decentralization on quality financial. Sep 23, 2018 consequently, fiscal, administrative and political authority for the delivery of healthcare is expected to be transferred from the central ministry of health moh to ghana health service ghs and other alternate institutions in an effort to ensure efficiency, equity, service innovations, quality, transparency, and accountability in the health. Discussion paper rethinking decentralisation of wash.
The first is the division of spending responsibilities and revenue sources between levels of government national, regional, local etc. The impact of decentralization on local governance in ghana since the implementation of reforms in 1988 started by provisional national defense council pndc for substantial realignment of functions between central government sector ministries and decentralized bodies was highlighted. The politics of fiscal decentralization in ghana the canadian. This piece of legislation built on previous ordinances. Government of ghana intergovernmental fiscal decentralisation framework english abstract. Fiscal decentralisation covers two interrelated issues. This study examined the impact of fiscal decentralization on quality financial reporting at local government level in ghana.
Challenges of ghanas decentralisation process news ghana. Abstract tanzania is currently implementing a local government reform aimed at improving public service delivery. Fiscal decentralization indicators this note contains the documentation on the database of fiscal decentralization indicators that are derived from imfs government finance statistics gfs. An important component of the reform is to increase the fiscal autonomy of. This policy initiative will upscale full implementation of fiscal decentralisation to ensure that the utilisation of all public resources at the local level takes place in an efficient, effective, transparent and accountable manner for improved service delivery. The oecd fiscal decentralisation database provides comparative information on the following indicators analysed by level of government sector federal or central, including social security, stateregional and local, for oecd member countries between 1965 and 2018. It is intended primarily for policymakers, in this case meaning civil servants and their. Discussion paper rethinking decentralisation of wash services. Decentralisation and management of human resource for. In africa in general, and ghana in particular, decentralization is now at the heart of government business and ongoing reforms alam and koranteng, 2007. News ghana is ghanas leading online news portal for business in west africa and around the world. Therefore, rethinking fiscal decentralization involves acknowledging the complex intermingling effects that global, national, and local territories produce. Our central interest in this paper is to examine how fiscal decentralisation is articulated to address the leading social disparities in south africa. Fiscal federalism 2016 surveys recent trends and policies in intergovernmental fiscal relations and subcentral government.
Share copy and redistribute the material in any medium or format. Fiscal decentralization constitutes the public finance dimension to decentralisation in general, defining how and in what way expenditures and revenues are organised between and across different levels of government in the national polity. Second, decentralisation and its fiscal components needs to be viewed as a process and not an end point. The authority to hire and allocate district personnel lies solely with the local government service secretariat, which is a nationallevel institution. Decentralisation in africa occurs on multiple levels. The case study research design was used and the qualitative research method was adopted to collect and analyze data from twentyfive 25 respondents. First we will look at the main features of fiscal decentralisation in south africa and assess its impact on the major components of social expenditure. Rethinking fiscal decentralization policies in developing.
Decentralisation and management of human resource for health. Government of ghana public disclosure authorized fiscal. This paper deals with ghana experience in fiscal decentralization. Decentralization and governance in ghana request pdf. One of the five pillars of ghanas decentralisation is fiscal decentralisation. Fiscal decentralisation ensures the transfer of adequate financial. It shows both the paucity of subnational resources, amounting to generally less than 5 percent. Decentralisation extends to the lowest level of the organisation. Burkina faso, ghana, kenya, and senegal bernard dafflon and thierry.
Proponents of fiscal decentralisation believe that, devolving government tax and expenditure responsibilities to lower tiers of governments will lead to the efficiency of governments and ultimately enhance economic growth. Involvement of nonstate actors in local governance ngo, cso, cbo, etc. Decentralization in government developing countries. Ashanti regional coordinating council 1997 manual for the utilisation of the.
Contextualizing fiscal decentralization fiscal decentralization defines how and in what way expenditures and revenues are organized between and across different levels of government in the national polity. Decentralisation refers to tire systematic effort to delegate. Fiscal decentralisation under the district assemblies common fund dacf in ghana is supposed to transfer more financial resources from the centre to the districts, and to provide fiscal autonomy. Fiscal decentralization can also obstruct the redistribution role of the central government. At the heart of ghanas current decentralization are the metropolitan, municipal and district chief executives mmdces who serve as the principal representatives of the president at the local level. Accessible and easyto read chapters provide insight. In some areas, poorly articulated fiscal decentralisation or the absence of it has been blamed for the poor performance of local governments chinsinga, 2008.
Various pfm reform initiatives have be implemented over the years and some are still ongoing to improve pfm in ghana this presentation provides overview of the pfm reforms in ghana and highlights of key related issues. The primary goal of this framework is to provide a comprehensive road map which has broad based support for the vision of fiscal decentralisation as well as the strategies to meet that vision. Intergovernmental fiscal transfers and tactical political. Related jurisdictionspecific indicators are available from the regional explorer. The global system of today also calls for increased decentralization as a guarantee of democratic governance. At the heart of ghanas current decentralization are the metropolitan, municipal and district chief ex. Local governance, decentralisation and corruption in. In this case, previously concentrated powers to tax and generate revenues are dispersed to other levels of government, e.
Each region of ghana has an elected representative and the president of ghana elects 11 members. Decentralisation of authority is a fundamental phase of delegation and the extent to which authority is. Fiscal decentralisation has been one of the key components of ghana s decentralisation program. Decentralisation can be viewed as an extension of delegation.
Fiscal decentralisation kenneth davey introduction fiscal decentralisation comprises the financial aspects of devolution to regional and local government. African countries have undergone waves of decentralisation reforms since their independence. The dispersal of authority of decisionmaking to the lower level management is termed as decentralization. For the problem of decentralizing government activities, mobility across regions is a critical factor. The impact of fiscal decentralisation on local economic. In addition the 1992 constitution of ghana provides that power and decision making should devolve on the decentralized authorities. July 2005 understanding fiscal decentralisation in south africa.
Decentralization is a complex and multifaceted concept that spans fiscal, political, and administrative dimensions. Background during the past three years the government of ghana gog has realised considerable achievements in. The framework addresses the functions between the central. Included are the types of indicators included as well as some guidance on how to use and how not to use the indicators as well as where to find the information. Executive summary 1 introduction 2 legal environment 3 decentralisation policy and goals 4 the intergovernmental fiscal decentralisation framework 5 o objectives and principles 5 o structure of framework 6 expenditure functional assignment and. Effectiveness of decentralization in ghana their obligations and attract able and competent officers ministry of local government. Fiscal decentralization is one of the strategies adopted to implement the decentralisation policy with the aim of ensuring adequate transfers of financial resources from central government to sub. In section 2, i provide a short overview of the main features of decentralisation in uganda, including political, administrative, and fiscal elements of the reform. The argument for fiscal decentralisation is anchored in the socalled first generation theory of bringing government closer to the people.
One important factor in determining the type of fiscal decentralization is the extent to which subnational entities are given autonomy to determine the allocation of their expenditures. On the fiscal side, subnational governments had to rely on their own sources of revenues. Fiscal decentralization and the efficiency of public. Pdf the governance work of the commonwealth secretariat has a particular focus on public sector.
To guarantee a minimum level of public service and basic needs or standard of living for the entire population regardless of their geographical location, the central government often. Meaning, advantages and disadvantages of decentralisation. Government privatizes or deregulates private functions. Since finance is the lifewire of local governments, poor funding affects their capacity to. Fiscal decentralisation overseas development institute. When a part of the work is entrusted to others, it is known as delegation. Fiscal decentralisation has gain prominence over the last three decades. Fiscal decentralisation overseas development institute odi. This thesis examined the impact of fiscal decentralisation on local economic development in ghana, evidence from the ketu south municipal assembly ksma. Fiscal decentralization in developing countries edited by richard m. The effectiveness of decentralisation on community. Fiscal decentralisation and efficiency of metropolitan.
Fiscal decentralization and the efficiency of public service. When decentralization is broadened to incorporate such concepts as devolution, alternative services delivery, privatization and so on, then the resource base on the subject would undoubtedly be massive. In ghana, decentralisation has been practiced since 1988 and the populace has come to embrace it as the best way of ensuring development and local participation in governance. July 2005 understanding fiscal decentralisation in south. Decentralisation efforts in ghana predates the attainment of independence from british rule. The local government system and decentralisation in ghana ghana is a constitutional democracy with two spheres of government central and local. Arrow, musgrave, samuelson, and others have done seminal work in this field. Trade and development isbn 0 521 64143 8 hardbound 1. Ghana, therefore formally started the decentralization process in 1988 and was given a boost by the 1992 constitution of the 4th republic. First we will look at the main features of fiscal decentralisation in south africa and assess its impact on. Fiscal decentralization, ghana, mixed methods, local government.
The basic view is that decentralisation of government will address the problems with allocative inefficiency. Ghana, direct and indirect international involvement have profound effect on these policies. Table 1 refers to a select group of west african countries at the beginning of the 90s. Understanding the context of fiscal decentralisation. It is also about the extent to which local governments are empowered, about how much authority and. At the present stage of decentralization, the mmdas have no say in when their staff will be relocated, nor do they have any means to retain able staff members. Proponents of fiscal decentralisation believe that, devolving government tax and expenditure responsibilities to lower tiers of governments will lead to the efficiency of governments and. Fiscal decentralisation and subnational government. To summarize the major fiscal decentralization issues. The study is important because it provides development partners with the assurance that metropolitan, municipal, and district assemblies mmdas funds are used for their intended purposes. The goal of pfm reform is to improve fiscal discipline and macroeconomic stability.
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