Fiscal decentralisation and service delivery: A case study of Lusaka City Council

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Ntazana, Musukuma Mutungwa
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This dissertation discusses fiscal decentralization and service delivery with particular attention to Lusaka City Council (LCC), one of the local authorities in Zambia. Zambia’s local government system encompasses an ideology of fiscal decentralization. In addition, the Local Government Act of 1991 provides for the funding of local councils by central government, and councils have been empowered by the law since 1980 (Local Administration Act) to engage in whatever business ventures, without restrictions from central authorities. Consequently, it is thought and expected that councils should have enough money to finance their projects and programs adequately. However, in spite of the existence of measures aimed at fostering decentralization in general and fiscal decentralization in particular, councils countrywide do not have sufficient financial resources to facilitate the effective performance of their functions, a situation which results into dismal service delivery and underdeveloped localities. This was the research problem. The general objective of the study was to assess the effectiveness of fiscal decentralization on service delivery by LCC. Specific objectives were: to determine the extent to which LCC collects revenue in relation to the services to be provided; to establish the extent to which LCC possesses autonomy over council expenditure; to examine the extent to which financial administration in LCC is transparent and accountable; to determine the adequacy of central government grants to LCC; to examine the usefulness of the legal and institutional frameworks regarding fiscal decentralization; and to find out the satisfaction levels of the local residents with regard to the services received from LCC. The study was both descriptive and explanatory in terms of its design. Both primary and secondary data were collected. Interviews, focus group discussions and questionnaires were used to collect both qualitative and quantitative data. Purposive sampling was used to select individuals who hold key positions regarding council operations, while simple random sampling was used to select local residents from all the seven constituencies in Lusaka City. Data were analyzed using both Excel (quantitative data) and the Manual or Narrative Method (qualitative data). The study found out that LCC collects less revenue than the cost of services to be provided; Central government transfers to LCC are inadequate; and the majority (86 percent) of the people of Lusaka City are either unsatisfied or very unsatisfied with the services received from the council. The researcher recommends that LCC should ensure that all the properties/buildings developed and developing within the city are captured on the council Valuation Roll by up-dating it regularly, and central government should permit local authorities to use Road Tax and VAT to broaden their revenue base.
Fiscal decentralisation , Local government---Administration , Financial Management--Local authority