Fiscal decentralisation and local development in Ghana with reference to the Tamale Municipal Assembly

• Main Author: Okawa, Keiko
• Published: SOAS, University of London 2008
• Subjects: 339.5209667
• Online Access: http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.504635

This thesis examines the impact on Ghana ofthe fiscal decentralisation policy introduced by the government of President J.J. Rawlings by examining in detail its impact on a peripheral, but large district covered by Tamale Municipal Assembly (TMA). In Ghana the substantive mechanism used to effect fiscal decentralisation is the District Assemblies Common Fund (DACF) through which, since 1996, five per cent of national income has been transferred to the country's District Assemblies for development at the local level. Four aspects of the DACF are considered, namely management and operation ofthe DACF, the implementation of development projects under DACF funding, the DACF's impact on local economic development, and the impact of decentralisation policy in Ghana on the functioning of the TMA . . This thesis finds that the amount ofDACF revenue used for capital investment was very limited. Inadequate funds for the DACF made available by central government is further limited by how ministries, other organisations and local MPs seek a share of DACF monies. Fiscal decentralisation has brought some, ifvery limited, development to a few communities only. Any local development has been uneven and without a strategic direction set by the District Assembly. Much of the DACF funds continue to be allocated along patronage lines. The district assembly's decentralised planning system maintains (and may even reinforce) the power of the existing local power structure. Decision-making power remains embedded in the District Assembly and there has been no effective consultation with ordinary citizens. In some cases local elites deliberately block the involvement ofthe wider populace. The Poverty Alleviation Fund is the microcredit programme of the DACF, which aims to boost economic development and poverty alleviation at the district level. It was found that its impact on the local economy is very limited. The design of the PAF lacks devices to establish sustainability and effectiveness in economic development and/or poverty alleviation.