LECTURE NOTES ON PUBLIC SECTOR ACCOUNTING:
CONCEPT OF DECENTRALISATION
ACCT 402: UNIVERSITY OF GHANA BUSINESS SCHOOL, DEPARTMENT OF
ACCOUNTING, LEGON-ACCRA
TABLE OF CONTENTS
1. Introduction to Ghana and Governance 2. The concept of Decentralisation
3. Structure of Minstry of Local Government and Rural Development (MLGRD) 4. General Structure of Tema Metropolitan Assembly (TMA)
5. Structure of Local Governance in Ghana
6. Importance of Decentralisation and Local Revenue 7. Functions of the MMDAs
8. Nature of MMDAs Revenue Components (IGFs) 9. Nature of MMDAs Expenditure Components 10. Strategies of MMDAs IGFs
11. Revenue Collection Challenges faced by MMDAs 12. Public Sector Accounting
13. Independent Accounting Standard-Setting Board
The Background to Decentralisation:
Ghana, as a sovereign state came under Gold Coast-colonialisation by the Europeans with the British coming in to occupy the centre stage as the colonial masters from the August 4th Bond of 1844 to the independence March 6th of
1957.
ANTECEDENTS OF DECENTRALISATION
Pre Colonial Period 1859-1943 1953-1961
Historical Development
Native Authorities and Chiefs
1. The Municipal Ordinance of 1859
2. 1943 new Ordinance set up elected town
councils for Sekondi-Takoradi Accra, Cape Coast and Kumasi (SACK)
1. In 1953, the Municipal Councils Ordinance was passed
2. After Independence, a Local Government Act, 1961, Act 54 was passed.
Distinctions among the various Acts passed
N/A Administrative activities was based in the capital with branches at the local district levels
Administrative activities was separate, distinct and was based in well-defined localities and was referred to as Local Government.
POST DR. KWAME NKRUMAH DECENTRALISATION ERA
1971-1974 1988-1992 Historical
Development
Though passed in 1971, the Local
Government Administration Act, 1971, Act 359, was not implemented until 1974 due to the change in government in 1972.
Significant changes were however made to the 1971 Act before it was commenced by the Local Administration (amendment) Decree 1974, NRCD 258.
The above background provided the raison d’etre for the structure, form and content of local government reforms in Ghana with
decentralisation as a major component in 1988.
These were given legal form by the new local government system and given legal backing by the Local Government Law, 1988, PNDCL 207, now superceded by chapter 20 of the 1992 Constitution and replaces by the Local Government Act, 1993, Act 462.
Distinctions among the
various Acts passed The 1974 Local Government Structure, described as the “Single Hierarchy Model”, sought to abolish the
distinction between local and central government at the local level to create one common monolithic structure to which was assigned the responsibility of the totality of government at the local level
Decentralisation is thus envisioned to transfer functions, powers, means and competence to the District Assemblies from the Central Government Ministries and Departments. This policy forms the basis of the new local government system which is premised on the assumption that too much power at the centre of governance was not equitably the best.
1. One of the foremost intentions that gave birth to the PNDC`s decentralisation administration policy of 1988 in Ghana was based on an attempt to introduce grassroots democracy at the doorsteps of the indigents so that they could have a more populace say in local governance in their various communities.
2. Four years after implementing this policy, the 1992 constitution was ushered in to revitalise the module to be known and called the District Assemblies (DA) Law making it the highest political authority in every district with planned, jurisdictive and decision-making powers to implement all the programmes of the central government under 86 explicit functions.
Prominent among them include c on s t ru ct i on o f roads, p r ot e ct i on o f forestry, agricultural extension, secondary education, health service delivery, fire prevention as well as town and country planning. This decentralisation policy has been practiced extensively in post-colonial independence years whereby many reforms at different regimes have been experimented all aimed at relinquishing part of central control in consolidating the local level powers to accelerate social development in all communities.
Conclusion: (Decentralisation)
1. Promotes popular grassroots participation in the administration of the various areas concerned from the stand points of planning, implementation, monitoring and delivery of those services which go to improve the living conditions of the people and the orderly, fair and balanced development of the whole country.
2. Transfers functions, powers, means and competence to the MMDAs from the GoG which is premised on the assumption that development is that which responds to people’s problems and represents their goals, objectives and priorities;
Decentralisation Characteristics:
1. It mandates local authorities to levy taxes and impose fees on various activities within their districts so as to give space for the GoG to deal with issues of national concern.
2. Policy initiative pursue to transfer part of developmental and decision-making powers of government to regional and MMDAs in response to the needs of rural developmental agenda by the state.
3. Separates the centre of implementation ROLES and transfers of local responsibilities to the MMDAs.
4. It aligns all government agencies in any given region, district or locality into one executive unit, through
the process of institutional integration, manpower absorption, composite budgeting and provision of funds for the decentralised services. It apportions tasks to the various levels of government as (a) Central Government Ministries/Departments to undertake policy planning, monitoring and evaluation of policies and programmes.
(b) Regions, through the Regional Co-ordinating Councils and their respective Regional Planning Co- ordinating Units, to play the important role of co-ordination, not in a regulatory manner, but to ensure consistency, compatibility and coherence of district level development; facilitate joint ventures among districts and monitor the activities of MMDAs within regions; and
(c) MMDAs to be primarily responsible for the implementation of development policies and programmes co-ordinated by the National Development Planning Commission (NDPC).
EXCEPTS OF LOCAL GOVERNMENT ACT 2016
Creation of Districts
1. (1) for purposes of Local governance, the districts in existence immediately before the commencement of this Act shall continue to exist.
(2) The President may, by Executive Instrument
(a) Declare any area within the country to be a district; and (b) Assign a name to the district.
(3) The President shall, in the exercise of the power under paragraph (a) of subsection (2), direct the Electoral Commission to make appropriate recommendations.
(4) The Electoral Commission shall, before making recommendations to the President under subsection (3), consider the following factors including
(a) In the case of
(i) A district, that there is a minimum population of 75,000 (ii) A municipality, that there is a minimum of 95,000 (iii) A metropolis, that there is a minimum of 250,000
(b) The geographical contiguity and economic viability of the area, namely, the ability of an area to provide the basic infrastructural and any other developmental needs from the monetary and any other resources generated in the area.
2
1951 Local Governance Ordinance
26
3
1961 Local Government Act
58
4
1974 Local Government Act
65
5
1988 PNDC Decree (207)
110
6
2003 Local Government Act
138
7
2007 Local Government Act
170
8
2012 Local Government Act
216
9
2018 Local Government Act
254
CREATION OF DISTRICTS IN THE PAST YEARS
NO LEGISLATIVE INSTRUMENT ASSEMBLIES CREATED TO DATE
ESTABLISHMENT OF DISTRICT ASSEMBLY
3. (1) The Minister shall, by legislative instrument, establish a District Assembly for each district, municipality and metropolis.
(3) The Instrument establishing a District Assembly, shall specify
(a) The area of authority of the District Assembly as determined Under subsection (2) of section 1;
(b) The number of persons to be elected to the District Assembly And the maximum number of persons to be appointed to the District Assembly by the President;
(c) The functions, powers and responsibilities of the District Assembly;
(d) The place where the principal office of the District Assembly is to be situated; and
(e) Other matters that are required by this Act to be included in the Instrument or are consequential or ancillary to it.
(4) The Minister shall establish
(a) Sub-Metropolitan District Councils,
(b) Urban Councils,
(c) Town or Area Councils, and
(d) Unit Committees
INCORPORATION OF DISTRICT ASSEMBLY
4. (1) A District Assembly shall be a body corporate with perpetual succession.
(2) For the performance of its functions, a District Assembly may acquire and hold movable and immovable property, dispose of property and enter into a contract or any other transaction.
(3) Where there is hindrance to the acquisition of property by a District Assembly, the property may be acquired for the District Assembly under the State Lands Act, 1962 (Act 125) and the cost shall be borne by the District Assembly.
COMPOSITION OF DISTRICT ASSEMBLY
5. (1) A District Assembly shall consist of the following members:
(a) The District Chief Executive;
(b) One person from each electoral area within the district elected by universal adult suffrage in accordance with regulations made for the purpose by the Electoral Commission; (c) The member or members of Parliament from the
constituencies that fall within the area of authority of the District Assembly; and
(d) other members that shall not exceed thirty 30% of the total membership of the District Assembly appointed by the President in consultation with the traditional authorities and other interest groups in the district.
(2) A Member of Parliament shall
(a) Be counted among the seventy per cent in the calculation of the thirty per cent of the appointed members; and
(b) Not have voting rights.
(3) The members appointed under paragraph (d) of subsection (1) may be
re-appointed.
(4) A District Assembly may conduct its business in English and in any local language common to the communities in the district.
(5) The District Co-ordinating Director appointed under subsection (1) of section 75 shall be the Secretary to the District Assembly.
QUALIFICATIONS AND DISQUALIFICATIONS OF
MEMBERS OF DISTRICT ASSEMBLIES
7.
(1) a person qualifies to be elected or appointed to a
District
Assembly if the person
(a)
is a citizen of Ghana of not less than eighteen years
of age;
(b)
Is a registered voter;
(c)
is ordinarily resident in the district in which the
person
Seeks election or for whose District Assembly the
person is
To be appointed; and
(d)
Has paid all taxes and rates or made
arrangements satisfactory to the appropriate
authority for the payment of the taxes and rates.
EMOLUMENTS OF MEMBERS OF DISTRICT ASSEMBLIES
11.
(1) the emoluments of a District Chief Executive of a
District
Assembly shall be determined by Parliament and shall be
charged on the
Consolidated Fund.
(2) The emoluments of a Presiding Member of a District
Assembly and other members of the District Assembly
shall be determined by the District Assembly and paid
out of the District Assembly’s own resources.
FUNCTIONS OF DISTRICT ASSEMBLY (PART I)
12.
(1) A District Assembly shall
(a)
Exercise political and administrative authority in
the district;
(b)
Promote local economic development; and
(c)
Provide guidance, give direction to and supervise
other
Administrative authorities in the district as may
be prescribed by law.
(2) A District Assembly shall exercise deliberative,
legislative and executive functions.
(3) Without limiting subsections (1) and (2), a
District Assembly
Shall
(a)
Be responsible for the overall development of the
district;
(b)
Formulate and execute plans, programmes and
strategies for
The effective mobilisation of the resources necessary for
the
FUNCTIONS OF DISTRICT ASSEMBLIES (PART II)
(c)Promote and support productive activity and social
development in the district and remove any obstacles
to initiative and development;
(d)
sponsor the education of students from the district
to fill particular manpower needs of the district
especially in the social sectors of education and
health, making sure that the sponsorship is fairly and
equitably balanced between male and female
students;
(e)
Initiate programmes for the development of basic
infrastructure and provide municipal works and
services in the district;
(f)
Be responsible for the development, improvement
and management of human settlements and the
environment in the district;
(g)
In co-operation with the appropriate national and
local security agencies, be responsible for the
maintenance of security and public safety in the
district;
FUNCTIONS OF DISTRICT ASSEMBLIES (PART III)
(h)
Ensure ready access to courts in the district for the
promotion of justice;
(i)
act to preserve and promote the cultural heritage within
the district;
(j)
Initiate, sponsor or carry out studies that may be
necessary for the discharge of any of the duties conferred
by this Act or any other enactment; and
(k)
Perform any other functions that may be provided under
another enactment.
DISTRICT CHIEF EXECUTIVE
20. (1) there shall be a District Chief Executive for each district appointed by the President with the prior approval of not less than two-thirds majority of the members of the District Assembly present and voting at the meeting.
(2) A District Chief Executive shall
(a) Preside at meetings of the Executive Committee of the District Assembly and in the absence of the District Chief Executive a member of the Executive Committee elected by the members present from among themselves shall preside;
(b) Be responsible for the day-to-day performance of the executive and administrative functions of the District Assembly;
(c) Be responsible for the supervision of the departments of the District Assembly; and
(d) Be the chief representative of the Central Government in the district.
KEY ACTORS IN THE ASSEMBLY SYSTEM
1. District Chief Executive (DCE)
2. Presiding Member (PM)
3. Member(s) of Parliament (MP)
4. Coordinating Director (DCD)
5. Assembly members both elected and appointed
6. Technical/Professional and supporting staf
OTHER ACTORS IN THE LG ENVIRONMENT
7. Traditional authorities, Opinion and religious leaders
8. Economic associations and occupational groupings
9. Social groups and membership associations/faith-based
10. NGOs and CBOs in development projects
11. Organised labour/labour unions
12. Formal private sector
PROVISION OF OFFICES BY DISTRICT ASSEMBLIES
30. A District Assembly may
(a) Build, acquire, provide, hire and furnish buildings within the administrative area of the District Assembly,
(b) combine with another District Assembly to build, acquire, provide, hire and furnish a building within or outside the administrative area of the District Assembly, or
(c) Contribute towards the expense incurred by another District Assembly in building, acquiring, providing, hiring and furnishing any building within or outside the administrative area of the District Assembly to be used to transact the business of the District Assembly and for public meetings.
JOINT COMMERCIAL ACTIVITY
32. A District Assembly may join another District Assembly to carry out any commercial activity that falls within the scope of their respective functions and may determine the allocation of the cost and benefits in respect of that activity.Procurement powers and tender procedures of District Assembly
Expenses in respect of transferred functions
38. Where any functions of a District Assembly are transferred by the
President to a person or body by Executive Instrument, the expenses incurred by the person or body in the performance of those functions shall be a debt due from the District Assembly concerned, to the person or body.
District Assemblies to contribute to Association
39. (1) A District Assembly shall make a contribution to the National
Association of Local Authorities of Ghana as the Association may determine.
(2) The contribution shall be in respect of any expenditure incurred by the Association to undertake its business and hold its meetings.
PARTICIPATION IN DISTRICT ASSEMBLY PROCESSES (PART I)
40. A District Assembly shall enable the residents and other stakeholders in the district to participate effectively in the activities of the District Assembly and the sub-district structures of the District Assembly.
Participation in by-laws and fee-fixing resolutions 41. District level stakeholders may
(a) Participate in the deliberative function of the District Assembly by the publication of a draft by-law or fee-fixing resolution in a media of mass communication in the district that includes radio, the print media, notice boards on the
premises of the District Assembly and in the major towns and settlements in the district, before the commencement of
proceedings on the draft by-law or fee-fixing resolution;
(b) Make representations to the District Assembly through the Secretary to the District Assembly on any provision of the draft by-law or proposal in the fee-fixing resolution;
(c) Appear before a sub-committee of the Executive Committee to which a draft by-law or fee-fixing resolution is referred to make an oral representation;
PARTICIPATION IN DISTRICT ASSEMBLY PROCESSES (PART II)
(d) Attend the proceedings of the District Assembly as observers when a draft by-law or fee-fixing resolution is being debated;
(e) Disseminate the by-law or fee-fixing resolution as widely as possible and play an advocacy role on the contents of the by-law or fee-fixing resolution after the enactment of the by-law or the adoption of a fee-fixing resolution.
(2) The District Assembly shall cause a public announcement to be made at least ten working days before the first day of submission of the draft by-law or the fee-fixing resolution to the District Assembly for the first time.
1
110 districts were first introduced under decentralisation policy
by PNDC Law 207 in 1989. This has since been moved to 254 as
of March 2018.
2
The criteria needed for one locality to qualify as a district is
based on the population and current resources available within a
district.
3
AMA is the largest Metropolitan Assembly in Ghana with
Assembly members constituting 58 as of December, 2016.
4
Efutu Municipal Assembly is the smallest Municipal Assembly by
size and geographical area in Ghana.
FUN FACTS ABOUT LOCAL GOVERNMENT
IN GHANA .
England`s longest serving councillor is Lloyd Wilce for the Labour
Party. By 29
thMay, 2017, he had served on Cinderford Town
Council for 69 years.
The youngest councillor in England is Jade Morgan, who was just
18 years when elected to Preston City Council on 6
thMay, 2016
Birmingham has the largest council population with 1,101,360
people.
West Somerset has the smallest local council by population with
34,222 people.
FUN FACTS ABOUT LOCAL GOVERNMENT IN THE UNITED KINGDOM
DISTRICT BUDGET
122.
The budget for a District Assembly shall comprise
(a)
The aggregate revenue and expenditure of the
Office of the District Assembly, the Departments of
the District Assembly; and
(b)
The budget for the annual development plans and
programmes of the Departments of the District
Assembly.
Submission of budget estimates
123.
(1) Each District Assembly is responsible for the
preparation, administration and control of the budgetary
allocation of the Office of the District Assembly and the
Departments of the District Assembly.
(2) Each District Assembly shall before the end of
each financial year, submit to the Regional Co-ordinating
Councils, the detailed budget for the respective district
that states the estimated revenue and expenditure of the
District Assembly for the ensuing year.
(3) The Regional Co-ordinating Council shall collate
and co- ordinate the budgets for the districts in the region
and shall submit same to the Minister responsible for
Finance.
REVENUE OF DISTRICT ASSEMBLIES
124. (1) the revenues of a District Assembly comprise
(a) Decentralised transfers;
(b) Internally generated funds; and
(c) Donations and grants.
(2) Decentralised transfers comprise funds from the following revenue sources:
(a) The District Assemblies Common Fund;
(b) Grants-in-aid from the central government; and
(c) Any other revenue transferred from the central Government to the District Assembly.
(3) Internally generated funds comprise funds from the following sources:
(a) Licences;
(b) Fees and miscellaneous charges;
(c) Taxes;
(d) Investment income; and
THE SUBJECT OF TAXATION AS THE MAJOR SOURCE OF
REVENUE TO ALL GOVERNMENTS
Taxation is a levy imposed on the citizens without them
necessarily getting a
direct benefit.
There are three main
characteristics of taxation as indicated below:
1. It must be compulsory,
2. The correcting agency must be government
organisation and
3. It must be backed by the laws of the country.
The first attempt by government to introduce Taxation in
Ghana was the Poll Tax Ordinance of 1852 but this was
withdrawn in 1861 as a results of several challenges.
THE RIGHT HONOURABLE WILLIAM PITT THE YOUNGER
19 December 1783
14 March 1801
Chancellor of the Exchequer
Leader of the House of Commons
Father of Income Tax (December, 1799)
TAXATION UNDER LOCAL GOVERNMENT ACT OF 2016
(b) Revenue from levies and fees charged in respect of activities listed in the Eleventh Schedule shall be collected exclusively by or for the District Assembly.
Taxes and other Revenues
142. (1) A District Assembly shall collect the taxes chargeable on the income of the income earners listed in the Twelfth Schedule.
(2) The Minister may, in consultation with the Minister responsible for Finance and subject to the terms and conditions agreed upon with an appropriate public body, authorise that the public body collect taxes imposed on the income earners specified in the Twelfth Schedule on behalf of the District Assembly.
Investment income
143. (1) A District Assembly may in consultation with the
Minister responsible for Finance invest any portion of moneys of the District
Assembly in safe securities other than Government treasury bills. (2) Income from the investment made under subsection (1) shall constitute part of the revenue of the Assembly.
RATING AUTHORITY
144. A District Assembly shall be the only authority to levy rates for a district despite any customary law to the contrary.
Duty to levy sufficient rates
145. (1) A District Assembly shall levy sufficient rates to provide for the total estimated expenditure to be incurred by the District Assembly during the period in respect of which the rate is levied.
(2) A District Assembly may levy rates for an additional amount required to cover expenditure previously incurred by the District Assembly to meet contingencies or to defray any expenditure which needs to be defrayed.
(3) The additional rates may be made and levied before the date on which payment is received in respect of the immediate rates.
METHOD OF RATING (PART I)
146. (1) A District Assembly shall levy general or special rates for the amount considered necessary to raise sufficient funds to meet expenditure
(2) A general rate may be
(a) A rate payable by the owner of premises within the district on the rateable value of the premises; or
(b) A rate assessed on the possessions or any category of possessions of persons who reside within the district.
(3) A special rate may be
(a) A basic amount payable by any person of the age of eighteen years and above, but below the age of seventy years who resides within the area ;or
(b) An amount imposed on an owner of movable or immovable property in the area, but a District Assembly in fixing the basic rate, shall consult with district level stakeholders in the district.
(4) A basic rate shall be sufficient at least to cover the cost of collection.
(5) A person registered as a voter in a district may be required to pay rates imposed by the District Assembly for that district even if the person has not resided in the district.
METHOD OF RATING (PART II)
6) A general or special rate imposed on immovable property under this section shall
be at a specified rate per Ghana Cedi on the rate- able value of the property but the
amount per Ghana Cedi shall vary as between specified areas of the district, except
that within a mixed development area, the amount per Ghana Cedi on rateable
value shall vary in respect of property used for diferent purposes.
(7) Subject to the exemptions from and remission of rates, rateable premises shall
be premises that comprise buildings, structures or similar development.
(8) The Minister shall in consultation with the Minister responsible for valuation
cause to be determined by the Lands Commission or by a valuer appointed by the
Lands Commission, the rateable value of premises and may cause a valuation list to
be prepared for each district.
(9) The rateable value of premises shall be the replacement cost of the buildings,
structures and other structural development that comprises the premises after the
deduction of the amount it would cost at the time of valuation to restore the
premises to a condition in which they would be as serviceable as they were when
new.
RATE PAYERS AND RATE COLLECTORS
161. (1) Each District Assembly shall prepare and maintain proper records of rateable persons and tenements in its district.
(2) A District Assembly may, in writing, authorise any suitable person, to be a rate collector in respect of a specified area of a district.
(3) A rate collector shall
(a) Furnish the District Assembly concerned with a written nominal roll of every rateable person in the area in respect of which the rate collector has been authorised to collect rates;
(b) Collect and receive rates payable from each person liable for the payment of rates in the area;
(c) Pay the amounts collected to the District Assembly concerned; and
(d) Report any person who has failed to pay the amount due to the District Assembly concerned.
PENALTY IN RESPECT OF OFFENCES BY RATE COLLECTORS
162. A rate collector who
(a) Fails to deposit with the District Assembly concerned any sum of money collected as rates,
(b) Knowingly demands from any person an amount in excess of the duly assessed rates,
(b) Renders false returns, whether orally or in writing, or
(c) Wilfully fails to carry out a duty imposed as a rate collector commits an offence and is liable on summary conviction to a fine of not less than one hundred and twenty-five penalty units and not more than
two hundred and fifty penalty units or to a term of imprisonment of not
less than six months and not more than twelve months or to both the fine and term of imprisonment without limiting liability for civil action by the District Assembly to recover what is due from the rate collector.
EXPENDITURE
170. (1) A District Assembly may incur any expenditure necessary for or incidental to the carrying out of a function conferred on the District Assembly under this Act, or by the Instrument which established that District Assembly, but the expenditure shall be included in the approved budget for the District Assembly for the relevant year.
(2) For the avoidance of doubt, any moneys received by a District Assembly from the Common Fund shall be expended only on projects that form part of the approved development plan for the district.
WRITING OFF OF IRRECOVERABLE ARREARS OF REVENUE
171. (1) A District Assembly may write off any sum due and payable to that District Assembly from or by any person for sufficient cause which shall be an irrecoverable debt in any one year, but this shall not exceed an amount to be determined each year by the Minister.
(2) A District Assembly shall inform the Minister in writing of the total sum written off and the reasons for doing so.
KEEPING OF ACCOUNTS AND PUBLICATION OF ANNUAL STATEMENT OF ACCOUNTS
172. (1) Each District Assembly shall keep accounts and proper records in relation to the accounts and shall prepare immediately after the end of each financial year, a statement of its accounts in the form that the Auditor-General may direct.
(2) Each District Assembly shall publish at its own office including sub-district offices and in any other manner directed by the Minister,
(a) The annual statement of its accounts; and
(c) The report on the accounts and statements made by the Auditor-General
Power of Minister to give financial instructions
173. (1) The Minister may issue written instructions for the improved control and efficient management of the finances of District Assemblies after consultation with the Minister responsible for Finance.
(2) The instructions may be issued either generally or with respect to a particular District Assembly and shall be complied with by District Assemblies generally or the District Assembly concerned.
INTERNAL AUDIT
175. (1) Each District Assembly shall have an Internal Audit Unit.
(2) The staff of the Internal Audit Unit are members of the Local Government Service.
(3) The Head of the Local Government Service in appointing the staff of the Internal Audit Units of the District Assemblies shall have regard to the standards and procedures determined by the Internal Audit Agency established under the Internal Audit Agency Act, 2003 (Act 658).
(4) The Head of the Internal Audit Unit of the District Assembly
(a) is responsible to the District Assembly;
(b) Shall, at intervals of three months, prepare a report on the
Internal audit work carried out by the Unit during the three
Month period immediately preceding the preparation of the report and submit the report to the Presiding Member of the District Assembly;
(c) Shall make observations necessary as to the conduct of the financial affairs of the District Assembly during the period to which the report relates; and
(d) Shall forward a copy of each report prepared by the Unit to the District Chief Executive, the Minister, the Internal Audit Agency, the Regional Co-ordinating Council and the Office of the Head of the Local Government Service. (5) The Audit Report Implementation Committee of a District Assembly is responsible for the implementation of the recommendations of the internal audit reports.
EXTERNAL AUDIT
Auditor-General to audit accounts of District Assemblies
176. (1) The Auditor-General or an auditor appointed by the Auditor- General shall, each year, audit the accounts of each District Assembly, together with the books, records, returns and other documents relevant to the accounts and the financial statement.
(2) The Auditor-General shall, each year, submit a report to the Minister, Parliament and the relevant District Assembly on the accounts of the District Assembly, together with the books, records, returns and other documents relevant to the accounts and the annual statement of the accounts.
(3) The Auditor-General shall, in the report submitted under sub- section (2), draw attention to any irregularities in the
accounts audited. The provisions on audit in a District Assembly shall be subject to any other enactment in relation to the audit of public accounts and the functions of the Auditor General.
(5) The District Assembly shall take the Auditor-General’s
report into consideration at its next ordinary meeting or as soon as practicable after that.
DISTRICT ASSEMBLY TO MAKE BY-LAWS
181. (
1) A District Assembly may make by-laws for the
purpose of any function conferred on that District
Assembly by this Act or any other enactment
.
(2) A District Assembly may
(a)
specify as penalty for contravention of a by-law,
a fine of not less than one hundred penalty units
and not more than two hundred and fifty penalty
units or a term of imprisonment of not less than six
months and not more than twelve months or to both
the fine and imprisonment;
(b)
specify a further penalty of not more than one
penalty unit in the case of a continuing offence for
each day on which the offence is continued after
written notice of the offence has been served on the
offender; and
(c)
Make provision for the payment of such fees or
charges as the District Assembly may consider fit in
the by-laws.
(3) A by-law made by a District Assembly shall be
read and construed subject to this Act and any other
enactment.
COMPOSITION OF REGIONAL CO-ORDINATING COUNCILS
187.
(1) A Regional Co-ordinating Council consists of
(a)
The Regional Minister and the Deputy or Deputies;
(b)
The Presiding Member of each District Assembly in
the region and the District Chief Executive of each
district in the region;
(c)
Two chiefs from the Regional House of Chiefs; and
(d)
The regional heads of the decentralised Ministries
in the region as members without the right to vote.
(2) The Regional Minister is the chairperson of the
Regional
Co-ordinating Council.
STRUCTURE OF MMDAS AS AT MARCH, 2018
Under the authority of MLGRD, the structure of the Local Government System is made up of Regional Co-ordinating Councils divided mainly into three (3) sub-units as:
(a) Metropolitan Assemblies that take decisions with Sub-Metropolitan District Councils and Town Councils now has (TTASCK Assemblies) 6
metros in Ghana.
(b) Municipal Assemblies that take decisions with Zonal Councils and Unit Committees now has (MAs Assemblies) 60 municipals in Ghana
(c) District Assemblies that take decisions with Urban Councils and Area Councils now has (DAs Assemblies) 188 district in Ghana The above Assemblies, commonly known as MMDAs serve to consist of grass-roots involvement in the formulation and enactment of government strategies and the general development of their areas of control.
METROPOLITAN ASSEMBLY
1. Central Administration Depart.
MUNICIPAL ASSEMBLY
1. Central Administration Depart.
DISTRICT ASSEMBLY
1. Central Administration Depart. 2. Finance Department 2. Finance Department 2. Finance Department
3. Education, Youth and Sports 3. Education, Youth and Sports 3. Education, Youth and Sports 4. Metropolitan Health Depart. 4. Municipal Health Depart. 4. District Health Department 5. Agriculture Department 5. Agriculture Department 5. Agriculture Department 6. Physical Planning Depart. 6. Physical Planning Depart. 6. Physical Planning Depart.
7. Social Welfare and Community
Development Department 7. Social Protection and Community Development Department 7. Social Welfare and Community Development Department 8. Works Depar tment 8. Works Depar tment 8. Works Depar tment
9. Trade and Industry Department 9. Trade and Industry Department 9. Trade and Industry Department 10. Natural Resources
Conservation, Forestry and Game and Wildlife Department
10. Natural Resources
Conservation, Forestry and Game and Wildlife Department
10. Natural Resources Conservation, Forestry and Game and Wildlife Department
11. Disaster Prevention Department 11. Disaster Prevention Department 11. Disaster Prevention Department 12. Roads Department 12. Roads Department
-13. Transport Department 13. Transport Department
-14. Waste Management Department
-15. Budget and Rating Depart. -
-16. Legal Department -
(Sections 78 (1), (4) and 198 (4))
Existing Departments under District, Municipal and Metropolitan Assemblies
An example of a diagrammatical structure of the three tier structure of the Assemblies is shown on the next slide
Regional Coordinating Council
Metropolitan Assemblies
Municipal Assemblies
District Assemblies
Sub-Metropolitan District
Zonal Council Urban, Town
and Area Councils District Town
Councils Unit Communities
An example of a Metropolitan Assembly is shown
on the next slides
Geographical Divisions and Local Councils
(Comparison of LAs in 3 Countries)
Ghana 254 (10) Nigeria 774 (36) UK 418 (12)
Provision of Education ✓ ✓ ✓
Contruction of Highways ✓ ✓
Transport Planning ✓ ✓
Passenger Transport ✓
Social Care (CHPS) ✓ ✓ ✓
Housing ✓
Libraries ✓ ✓ ✓
Leisure and Recreation ✓ ✓ ✓
Environmental Health ✓ ✓ ✓
Waste Collection ✓ ✓ ✓
Waste disposal ✓ ✓ ✓
Planning applications ✓
Strategic Planning ✓
No.
Revenue Type
No. Revenue Types
1 Basic Rates 26 Herbalist License
2 Property Rates 27 Hawkers License
3 Stool Land Revenue 28 Pet License
4 Sanitation Fund 29 Chop Bars and Restaurants
5 Building Plans/Permit 30 Corn / Rice / Flour Miller
6 Sand and Stone Extraction License 31 Bakers License
7 Store Licensing 32 Bicycle License
8 Open Spaces /Parks 33 Artisan / Self Employed
9 Markets Tolls 34 Fuel Dealers
10 Burial Fee 35 Lotto Operators
11 Ponds 36 Hotel / Guest House/Night Club
12 Entertainment Fee 37 Sawmills
13
Marriage / Divorce
Registration
38
Taxicab / Commercial Vehicles
14
Sub Metro Managed Toilets
39
Canopy / Chairs / Bench
15
Dustin Clearance
40
Maternity Home /Clinics
16
Dislodging Fee
41
Wheel Trucks
17
Conservancy
42
Taxi Licences
18
Cesspit Emptying Service
43
Financial Institutions
19
Day Care Centre Fee
44
Private Schools
20
Lorry Park Fines
45
Public Letter Writers
21
Penalty
46
Beers Bars
22
Other Sundry Recoveries
47
Business Providers
23
Pito/Palm Wine Sellers Tapers
48
Advertisement / Bill Boards
24
Restaurants
49
Rent on Assembly Building
No. Expense Type No. Expense Types
1 Central Administrative Expenses 41 Trade, Industry and Tourism
2 Administration (Assembly Ofce) 42 Ofce of Departmental Head
3 Sub-Metros Administration 43 Trade
4 Finance 44 Tourism
5 Education, Youth and Sports 45 Budget and Rating
6 Ofce of Departmental Head 46 Legal
7 Education 47 Transport
8 Sports 48 Disaster Prevention
9 Youth 49 Urban Roads
10 Health 50 Birth and Death
11 Ofice of District Medical Ofcer of Health
51 Wages and Salaries
12 Environmental Health Unit 52 Monthly paid & casual labour
13 Hospital services 53 Car Maintenance Allowance
14 Waste Management 54 Commissions
15 Agriculture 55 Overtime Allowance
16 Physical Planning 56 Travel Allowance
17 Ofce of Departmental Head 57 Transfer Grants
18 Town and Country Planning 58 Out of Station Allowance
19 Parks and Gardens 59 Training - Seminars - Conferences
20 Social Welfare & Community Development
60 Public Education & Sensitisation
21 Ofce of Departmental Head 61 Materials - Ofice Supplies
22 Social Welfare 62 Printing & Stationery
23 Community Development 63 Refreshment Items
24 Natural Resource Conservation 64 Uniform and Protective Clothing
25 Works 65 Feeding Cost
26 Ofce of Departmental Head 66 Training & Development
27 Public Works 67 Utilities
28 Water 68 Electricity charges
29 Feeder Roads 69 Water
30 Rural Housing 70 Telecommunications
31 Rentals 71 Postal Charges
32 Office Accommodations 72 Fire Fighting Accessories
33 Rental of Office Equipment 73 General Cleaning
34 Hotel Accommodations 74 Maintenance of Furniture & Fixtures
35 Travel – Transport 75 Maintenance of Machinery
36 Maintenance & Repairs - Official Vehicles
76 Traditional Authority Property
37 Running Cost, Official Vehicles 77 Consulting Services
38 Foreign Travel & Expenses 78 Official Celebrations
39 Repairs – Maintenance 79 Special Services
STRATEGIES THAT MOST ASSEMBLIES HAVE ADOPTED TO IMPROVE UPON IGFs IN THE PAST YEARS
1. Conducting in-house regular revenue collection training programmes as well as sensitisation on taxation for revenue collection officers, revenue superintendents' and Rate Payers.
2. Organisation of regular workshops, symposiums and sensitisation programmes for stakeholders and rate payers. 3. Procuring revenue collection jobs to private individual firms at exorbitant 25% to 30% commission base
remunerations.
4. Giving out work incentives and motivations to collectors in the hope of increasing revenues.
5. Embarking on surprise field working exercises under the authority of management as a measure of monitoring collectors on the field to report on any collection maleficence to the Assemblies concerned.
6. Resorting to legal suit against defaulters as an alternative to enforce payment of fees and licensing.
7. Conducting property valuations for all houses within the jurisdiction in the hope of increasing the property rate bill components in coming years.
8. Collection of economic data and instituting a Database Management Systems (DMS) for all rate payers to track down payment of annual bills.
9. Instituting SMS alert technology system to track down revenue receipts from collectors.
10. Using the services of city guards for compulsory locking-up of defaulters’ shops and business centres during the last quarter of every year.
11. Using the Google Mapping technology in valuing properties especially in urban centres. 12. Always on the look out to break new grounds for any potential revenue to be generated. 13. The use of instant electronic Revenue Collections Devices at market centres.
REVENUE COLLECTION CHALLENGES STILL FACED BY MMDAs IN GHANA – PART 1
1. In spite of persistent on-going stakeholders’ sensitisation workshops organised by MMDAs, our research show that 25% of the indigents, still do not understand why they should pay Property Rates (PR) on buildings that they themselves have put-up. Literacy level is quite low.
2. Other citizens’ feel that their government is in power and so they should be given tax holidays for assisting their governments to take up political office.
3. Most legal actions brought against stubborn rate payers upon default usually turn out to make the Assemblies unpopular within the district.
4. The MMDAs in the last 10 years have been branded as corrupt institutions by the citizens and so rate payers see no reason why they should pay their bills for wrong purpose.
5. It is quite expensive collecting revenue on property rates across the country as most rate payers deliberately pay in bits and pieces till the last pesewa is made.
6. Quite a number of rate payers deliberately refuse to settle their bills because they claim the Assemblies are unable to meet their petty-petty needs such as street lights, assess roads to newly developed suburbs, untimely lifting of waste collection bins within the localities and provision of bole-holes.
REVENUE COLLECTION CHALLENGES STILL FACED BY MMDAs IN GHANA – PART 2
7. Most revenue collectors regularly do not have easy access to urban community homes to serve them with bills.
8. The Land Valuation Board still remains the sole agent in all government sponsored valuations and so their exorbitant charges has prevented most MMDAs from valuing their private residential assets with the view of improving on PR revenues.
9. The Assemblies have been bedeviled with revenue collection malpractices engaged by its own collectors for many years.
10.It is virtually impossible to collect all outstanding bills by the MMDAs in coming years.
11.Outsourcing revenue collections to private institutions by MMDAs in the last 10 years have not solve the annual target figures either.
12.Some rate payers who know certain influential officers of the Assemblies often use these personalities to dodge payment of taxes.
13.Most revenue collectors complain on the Assembly`s inability to supply them with revenue collection logistics such as Motor Cycles.
14.As 16% of our field work shows, professional qualifications of most revenue collectors and their superintendents are below standards as compared to staff of Ghana Revenue Authority (GRA) and so some rate payers do not recognise them as being government officials let alone pay their taxes to these officials.
1 2 3 4 5 6 7 8 9 10 11 12 13 14 0
5 10 15 20 25 30
A BAR CHART SHOWING A RESEARCH FINDINGS IN 16 MMDAs CONDUCTED BY CCC FROM 2006 TO 2016 FISCAL YEARS
Key factors that have been found to promote the
achievement of decentralisation include
1.
Political commitment, will and demonstrated
leadership by central administration
2.
Investments in the key priorities areas of the
economy.
3.
Ensuring technical capacities at the
decentralised level.
4.
Building broad based alliances and
partnerships with public sector organisations
5.
Collaboration at all levels, all sectors of the
economy and building partnerships between
governments and other stakeholders
International Accounting Standards Board International Public Sector Accounting Standards Board External Reporting Board (Ghana) Overall purpose
Provide the world's international
Accounting standards
Serves the public interest by creating high-quality accounting standards public
entities.
Uses laws under: 1. PFM Act 2016 2. LG Act 2016 3. FAR 2004 4. FAA Act 2003
Standards designed for
For-profit entities. Public sector and public benefit entities.
For-profit and public benefit entities. Name of standards the Board is responsible for International Financial Reporting Standards. International Public Sector Accounting Standards.
Ghana equivalents to International Financial Reporting Standards.
COMPARISON OF ACCOUNTING STANDARD-SETTING BOARDS AND GENERAL FINANCIAL ADMINISTRATION LAWS IN GHANA
Accounts Preparations
Uses GAAP ISA and IRFS
Uses IPSAS, GAAP and IAS
Uses GAAP and Cash Accounting
