Poor Revenue Collection by Local Authorities: Case Study of Kakamega Municipal Council

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POOR REVENUE COLLECTION IN LOCAL AUTHORITIES IN WESTERN PROVINCE

A CASE STUDY OF KAKAMEGA MUNICIPAL COUNCIL

BY

GERISHOM WAFULA MANASE
REG. NO. MBA (DL) 112/10186 (ACCOUNTING AND FINANCE)

A Research Project proposal submitted to Mount Kenya University in partial fulfillment of requirement for the degree of Masters in Business Administration, Accounting and Finance

June 2012

ABSTRACT
This study will explore the issue of lack of adequate revenue collection in local authorities Western Province; A case Study of Kakamega Municipal Council. First, it will describe the important role the local authorities play in the service delivery. They provide infrastructure and services that contribute to economic development at the local level (Ministry of Local Government _MOLG, Budget guidelines, 1999) and how lack of revenue affects this important role. This paper will go on to account for why there is the poor collection of revenue, looking at possible explanatory factors such as financial policies, management systems, decentralization of local authorities and the link there is between revenue collection and expenditure (Smoke (1991).

The primary hypothesis is that the challenges of revenue collection can be explained by a combination of factors including financial policies, management systems, decentralization of local authorities and the link there is between revenue and expenditure.

The methodology this research will employ include a review of secondary sources about history of Kakamega Municipal Council; history of local authority and systems of management; challenges facing local authorities in the implementation of the new constitution (Algak E-habari June 9, 2011, www.igfc.go.ug/corporate.php); the Local Authority Act Cap 265; other researches that have been done on local authorities; there is no information regarding revenue collection in Kakamega Municipal council. There will be primary sources of data collection that will be employed. These will include the administration of questionnaires to the senior municipal council employees. There will be using purposeful sampling as these are the people who are well placed to give the information required. The information gathered will help in revenue collection, not only I local authorities, but also by the Kenya Revenue Authority. Policies formulated will be used in the County Governments. This may form the launch pad for further researches in revenue collection in the country. The findings will be used to formulate and review policies on taxation and revenue collection for the government.

DECLARATION

I declare that this research is my own work. It is submitted in partial fulfillment for the award of a degree in Masters of Business Administration at Mount Kenya University. It has not been submitted before for any degree in any other University.

…………………………………………………Date …………………………………………… Gerishom Wafula MANASE

………………………………………………..Date …………………………………………….. Evans Nyamboga
Mount Kenya University, Supervisor

ACKNOWLEDGEMENTS

The MBA at Mount Kenya University has been truly a memorable journey and learning experience This has contributed to broadening my thinking , the forging of new networks and new friendships and establishing a solid platform for launching my career forward. I would like to convey my deepest thanks to the following people for contributing to making my MBA journey a success. * Mr. Evans Nyamboga, the supervisor of my Research Project Proposal. Many thanks for your insightful feedback and advices. Your encouragement, support, involvement, criticism have assisted in ensuring the smooth completion of my research project proposal. * The Teachers’ Service Commission, my employer for according me the study leave * My family, friends and colleagues for your patience, support and encouragement during the MBA programme. * Deeps for your motivation and inspiration to make this dream a reality. * My parents...
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