Agona West Municipal Assembly Plans Beyond Common Fund

A workshop has been organized by Agona West Municipal Assembly for 80 stakeholders on enhancing internal revenue mobilization.

The participants were selected from heads of decentralized departments, Assembly members, financial institutions, representatives from educational institutions, revenue collectors, executives from Ghana Federation of the Disabled , private commission collectors, market women associations and other socio-economic groupings at Agona Swedru.

The theme for the workshop was “Agona West beyond Common Fund”.

The aim was to discuss innovative ways of mobilizing revenue to finance the Assembly’s development projects envisaged in the Medium Term Development Plan for 2018-2021.

The Municipal Chief Executive (MCE), Honorable Justina Marigold Assan, launched the agenda of developing Agona West Municipality beyond common fund. She said that the Assembly was committed to developing Agona west Municipality using domestic revenues and prudent financial management.

She urged the stakeholders to come up with new ideas and innovative ways of improving revenue collection so as to mobilize enough resources locally.

She identified the use of measures such as comprehensive revenue data collection, computerized registers, and privatization of collection, pre-printed licenses/bills, effective revenue administration and weekend revenue collection.

The MCE urged the stakeholders to help the revenue collector assigned to their areas identify and register all eligible tax payers and sensitize the tax payers on the importance of paying taxes. She urged the participants to help follow up tax defaulters, identify new revenue sources and report fraudulent practices.

By reinforcing the MCE’s view, Dr Eric Akobeng, Development Economist and Principal Budget Analyst, who facilitated the workshop, demonstrated that the Agona West Municipal Assembly will receive an estimated Common Fund allocation of Four Hundred and Sixty Six Thousand Ghana Cedis (GHc466,000), which represents 20% of the District Assembly’s common fund (aside the 80% deduction based on government directive) for the District’s own projects in 2018.

"However, arrears and uncollected bills on property rate amounts to One Million, Five Hundred and Sixty Two Thousand Ghana Cedis (GHc1,562,000.00) based on the available data. Thus, the Assembly can carry many development projects with only property rate without the common fund"

Dr Eric Akobeng said lack of a good property rate collection strategy is impacting negatively on domestic revenue mobilization in the country.

He lauded Agona West Municipal Assembly for involving stakeholders to discuss innovative approaches to collect property rate. He urged all Metropolitan, Municipal, District Assemblies (MMDAs) in Ghana to follow the move.

He urged the Ministry of Local Government and Rural Development and the Local Government Service to assist MMDAs to collect data to determine their revenue collection potentials.

" This will help Assemblies to set realistic revenue targets and budget scientifically. This will also help the Administrator of the District Assemblies Common Fund in deciding on the 6% revenue improvement factor in the allocation of the fund to MMDAs"

Touching on the topic “Ghana beyond aid and revenue mobilization”, Dr Eric Akobeng said, under the Marshall Plan, the USA gave aid to 14 European countries.

"The plan brought Western Europe back onto a strong economic footing after the Second World War. If aid worked perfectly in Europe, why not Ghana? He argued that aid has not helped Ghana because of the dependency syndrome. Ghana has been creating poverty stories with over-ambitious development plans without doing much to mobilize local resources to finance our development. We live in the midst of many resources, but we are poor."

Dr. Eric Akobeng lauded the president for the self-sufficient policy direction but warned that debt servicing is taking a large portion of Ghana’s domestic revenue. This is making the economy of Ghana susceptible to shocks. According to him, in 2017, interest payment on public debt of Ghana was equal to 41.8% of total tax revenue. He urged the Government of Ghana to limit burrowing to high priority development interventions that have growth potentials.

According to him, continuous increase in the debt stock may impact negatively on the President’s agenda to grow the economy beyond aid. More revenue will be used to service national debt and this will affect capital expenditures after salaries and statutory commitments. He thus urged the government to depend on local revenue mobilization than borrowing.