Minority heads to court over DACF allocation
The Minority in Parliament is heading to court to seek clarification on Article 252 of the 1992 constitution which requires government to allocate not less than five per cent of total revenue to the District Assembly Common Fund (DACF).
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The government, in the 2017 Budget which was presented to the House on March 2, 2017 by the Minister of Finance, Mr Ken Ofori-Atta, allocated GH¢1.57 billion to the District Assemblies Common Fund (DACF), an amount the Minority said fell short of the constitutionally mandated five per cent of total revenue which is to be allocated to the DACF.
The Minority Leader, Mr Haruna Iddrisu, making a contribution on the budget estimates for the Ministry of Local Government and Rural Development, said the Minority was committed to the deepening of the decentralisation process of the country and would, therefore, not sit down unconcerned for the laws of the country to be breached.
“Mr Speaker, I am by this serving notice that we intend to invoke the exclusive jurisdiction of the Supreme Court on this matter to seek an interpretation on the difference between total revenue as defined in Article 252 of the Constitution and also total revenue as defined in the Local Governance Act, 936 of 2016,” he stated.
He said five per cent of projected tax revenue of GH¢34.382 billion should be GH¢1.71 billion instead of the GH¢1.57 billion captured for the DACF in the 2017 Budget Statement. The Member of Parliament (MP) for the Keta Constituency, Mr Richard Quashigah, has already initiated a court process to seek the interpretation of the Supreme Court of Article 252 of the Constitution.
The DACF was created under Article 252 of the Constitution to serve as a mechanism for the transfer of resources from the central government to the MMDAs.
Article 252 provides that five per cent of Ghana’s total revenue should be paid into the fund for distribution to the local authorities.
To operationalise this constitutional provision, Parliament also enacted the District Assemblies Common Fund Act (Act 455) in July 1993 to provide further legislation and detail on the administration of the Fund.
Majority dismiss claims
The Minister for Monitoring and Evaluation and Member of Parliament for Old Tafo, Mr Anthony Akoto Osei, during the budget debate dismissed the claim that the government was breaching the Constitution.
He said what the government had done was to deduct the VAT refund, cost of collection and royalties, which would bring the total projected revenue to GH¢31.442 billion.
This amount, he said, when divided by the GH¢1.57 billion would be 5.09 per cent, which was within the mandated five percent.
Parliament approves local govt estimates
Parliament has approved GH¢321.83 million as the 2017 annual budget of the Ministry of Local Government and Rural Development.
The estimates of the ministry were contained in the budget statement and economic policy of the government for the 2017 financial year.
According to the report of the Committee on Local Government and Rural Development, out of the GH¢321.83 million, GH¢10 million had been earmarked for compensation, GH¢29.71 million for goods and services, with GH¢1.6 million dedicated for the acquisition of assets.
Reliance on donor support
The committee in its report also observed that the budget for the ministry is heavily dependent on donor support, saying its analysis of the estimates indicates that donor component represents 85 per cent of the total budget, with 99 per cent of the allocation for assets to be funded from donor sources.
It stated that since donor support for the District Development Fund (DDF) would end in 2017, the impact was likely to be negative after 2017 if no alternative sources were found.
It, therefore, urged the ministry to liaise with the Ministry of Finance to explore other sources of funding to support its activities.
The report also identified outstanding arrears of $40 million, being the counterpart funding for the DDF, saying the budget did not make any provision to cater for the arrears.