Strategies for Improved Revenue Generation in Local Governments

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STRATEGIES FOR IMPROVED REVENUE GENERATION IN LOCAL GOVERNMENTS

1.0INTRODUCTION

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?

2.0MAIN 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 Government sets out the main functions of a Local Government as follows:

Formulation of economic planning and development scheme for Local Government Councils Collection of rates and issuance of radio and television licenses Establishment and maintenance of cemeteries, burial grounds, and homes for the destitute or reform Licensing of bicycles, trucks (other than mechanically propelled truck), canoes, wheel barrows and carts Establishment, maintenance and regulation of slaughter houses, slaughter slabs, markets, motor packs and public conveniences Construction and maintenance of roads, streets, street lightings, drains, parks, gardens, open spaces, or such public facilities as may be prescribed from time to time by the Executive Governor or House of Assemble of a State Naming of roads and streets and numbering of houses

Provision and maintenance of public conveniences, sewage and refuse disposal Registration of all births, deaths, and marriages
Assessment of privately owned houses or tenements for the purpose of levying such rates as may be prescribed by the Executive Governor or House of Assemble of a State Licensing, regulation and control of the sale of liquor

Control and regulation of:
oOut-door advertising and hoardings
oMovement and keeping of pets of all descriptions
oShops and kiosks
oRestaurants, bakeries and other places of sale of food to the public oLaundries

The Chairman of each Local Government is the Chief Executive and Accounting Officer of the Local Government, though his role as Accounting Officer does not include the signing of cheques and vouchers.

3.0HISTORY OF REVENUE GENERATION IN LOCAL GOVERNMENTS

The 1976 reform was a landmark in the history and development of local governments in Nigeria. For the first time, the country was given a common, single-tier structure of local government in place of the different structures of various states. The 1976 Local Government Reform was the...
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