Strategies for Improved Revenue Generation in Local Governments
STRATEGIES FOR IMPROVED REVENUE GENERATION IN LOCAL GOVERNMENTS
1.0 INTRODUCTION
Local governments operate at the grassroots and are expected to provide services to their stakeholders. In a federal system like Nigeria, local governments are close to the people and hence could effectively alter socioeconomic and political conditions within their jurisdictions. Apart from providing and maintaining basic infrastructures, local governments can complement the economic activities of other levels of government. This of course depends on the availability and proper utilization of funds.
Revenue generation is therefore an important issue for Local Government Councils. It is through this activity that the Councils source the finance for funding their operations, thus to a large extent, determining the quantity and quality of services provided to the generality of people within their domain. These reasons, coupled with the fact that Local Governments are engines of growth and development, make imperative the need for Local Governments to map out strategies for improved revenue generation, emphasising especially the internal sources which are more flexible, and could be in the total control of the Local Governments, unlike the share from the Distributable Pool Accounts.
In examining the strategies for improved revenue generation in Local Governments, this paper will seek to answer the following questions:
What are the main functions of the Local Government Councils?
What is the history of revenue generation in Local Governments?
How can we harness the revenue potentials of Local Governments?
How should the revenue section of the finance department and revenue collection machinery work?
2.0 MAIN FUNCTIONS OF LOCAL GOVERNMENT COUNCILS
The import of examining the functions of Local Government Councils is to appreciate the myriad of activities expected of them in the process of providing services to their communities. The principal Decree on Local
1.0 INTRODUCTION
Local governments operate at the grassroots and are expected to provide services to their stakeholders. In a federal system like Nigeria, local governments are close to the people and hence could effectively alter socioeconomic and political conditions within their jurisdictions. Apart from providing and maintaining basic infrastructures, local governments can complement the economic activities of other levels of government. This of course depends on the availability and proper utilization of funds.
Revenue generation is therefore an important issue for Local Government Councils. It is through this activity that the Councils source the finance for funding their operations, thus to a large extent, determining the quantity and quality of services provided to the generality of people within their domain. These reasons, coupled with the fact that Local Governments are engines of growth and development, make imperative the need for Local Governments to map out strategies for improved revenue generation, emphasising especially the internal sources which are more flexible, and could be in the total control of the Local Governments, unlike the share from the Distributable Pool Accounts.
In examining the strategies for improved revenue generation in Local Governments, this paper will seek to answer the following questions:
What are the main functions of the Local Government Councils?
What is the history of revenue generation in Local Governments?
How can we harness the revenue potentials of Local Governments?
How should the revenue section of the finance department and revenue collection machinery work?
2.0 MAIN FUNCTIONS OF LOCAL GOVERNMENT COUNCILS
The import of examining the functions of Local Government Councils is to appreciate the myriad of activities expected of them in the process of providing services to their communities. The principal Decree on Local
References: Aluko M. E. (2004) The 9% Fight between Federal and State Governments over Revenue Allocation http://www.dawodu.com/ Ekpo A H. and Ndebbio J.E.U., (1998), Local Government Fiscal Operations in Nigeria, AERC Research Paper 73 African Economic Research Consortium, Nairobi