A guide for citizens, local gov’t officers on the budget process for municipalities, NDCs

Dear Editor,

The Budget as an economic tool for the effective and efficient management of community resources.

1) In less than two months, the APNU+AFC Government is expected to present to the National Assembly of Guyana for debate and approval, the Country’s 2017 National and Regional Budgets.

And may I remind our Municipalities and Neighbourhood Democratic Councils (NDCs) that they too are expected to receive and consider their Estimates for 2017 before 31.12.2016. Indeed, “The City Council and the Town Councils shall, not later than the fifteenth day of November in every year, cause to be submitted to them estimates of the revenues and expenditure of the Council for the next financial year.” Chapter 28:01.

In the case of the NDCs, note that “On or before the 31st December in every year, or, with the consent of the Minister, before the 15th February in any year, the Chairman of the Local Authority shall submit to the Authority an estimate of the expenditure for the ensuing year or for the current year as the case may be”. In both instances (Municipalities and NDCs) the Financial Year shall be the twelve months ending 31st December. Chapter 28:02

In my examination of the above subject matter, I limit my comments to the Municipalities and Neighbourhood Democratic Councils (NDCs); most of whose primary source of revenue to provide goods and services to its citizens are the rates and taxes paid by residents who own properties situated within the Municipalities/ NDCs.

2)The Budget is the Municipalities’ and the NDCs’ most important economic tool for allocating scarce financial resources among its various Programmes and Projects and for monitoring to ensure effective and efficient management of these resources.

A prioritized list of Council goals arising out of consultations with residents residing within the boundaries of the respective NDCs and Municipalities will help in making decisions on how to allocate scarce resources in the Budget process. In this regard also, the Councils ought not to be unmindful of Central Government national goals and, may I daresay, provided also that the said residents were part of a consultation process in defining and prioritizing these national goals.

3) The Budget is not merely a set of numbers but planned and controlled measures which reflect a vision for the future of the Municipality and the NDC. It is a legal document that once approved by the Council and the Minister, gives the Council the authority to incur obligations and to expend financial resources to meet these obligations. It controls how much is spent viz: on Infrastructure Maintenance, Health Care and Environment, Solid Waste management and other projects/services which the Council plans to provide.

It is also an evaluation tool for comparing accomplishments of one year or one period against another. In fact comparisons of revenues and expenditures over a period.. are very useful.

4)The Budget process for 2017 ought to have started about 3 months ago. Normally the Municipal Treasurer and/or a Standing Committee (the Finance Committee) in the case of Municipalities and the Overseer and/or a Finance Committee in the case of NDCs is designated the responsibility of preparing the Budget.

There ought to be consultation with the residents of the NDC and Municipality in the form of Budget Meetings for which adequate notice must be given re. time and Venue for the meeting. These public consultations are to be preferred to some Councillors and staff sitting in a room to take such decisions. The Councils must plan with the people and not merely for them. Reaching out to residents individually, collectively in groups allows not only for citizens’ participation in deciding priorities but for citizens involvement in the monitoring of projects and for timely and quality implementation. It provides the Councils an effective way to build trust and confidence with the citizens.

Provided the Local Authority has residents’ input and the Budget is discussed and agreed on at the level of the Council; it is then presented to the Ministry of Communities for the Minister’s approval. Without this approval, the Council could not levy and collect taxes let alone expend those taxes. The Minister must show due cause/reason for withholding his approval.

4) Implementing the Budget. Providing the Budget has the input and support of significant numbers of the citizenry and aims to improve the extent and quality of services the Council wishes to provide to the citizens; the Council can feel confident of the continual involvement of citizens in providing oversight and helping to monitor works being implemented.

Involve the citizens. What do you have to hide? It’s one way you improve rates collection: when citizens are involved in the process of getting things done to benefit themselves.

Never underestimate the role of public relations in improving Local Governance. NDCs and Municipalities need resources to finance the services and activities for which they have budgeted. We must not allow our own selfish agenda to inhibit or frustrate the work of Council.

5)Expanding and improving the extent and quality of services and the revenue provided by Local Government

a) Local rates and taxes are the main source of revenue among Local Authorities; and these are generally small and problematic to collect. That’s why we must seek opportunities to expand to include other services and the additional revenue accruing therefrom viz: Rent for Market Stalls, fees in respect of Education and Health facilities established or maintained by the Local Government e.g. Day Care Centres, profits from Local Enterprises etc.

b)And that is why expenditure controls are necessary. And that is why also local revenue raising is supported by a system of Fiscal Transfers from Central Government to ensure that Local Governments have sufficient resources to carry out their mandated functions.

6)Challenges of Local Governance and how we bring about improvements

As you review and appraise the performance of your Council; may I suggest, on a quarterly basis, some important areas of focus:

a)Corruption and incompetence e.g. Altering financial records to facilitate criminal evasion of rates/taxes owed or what amounts to unauthorized waiver of rates. Demand accountability. Have regular scheduled financial checks/audits and reviews.

b) Overstaffing and poor quality entrants because of unattractive salaries; poor supervision… The Local Government Commission is expected to address these deficiencies and more… training, retooling etc

Be acquainted with the Laws, By Laws, Rules and Regulations that guide what Council is expected to do; how Council is expected to do it; with what result. You must not avoid established norms, practices and procedures at our own whims and fancies. Ultimately we must work to improve the extent and quality of services we provide to our citizens.

Unless we are able to efficiently do these thing our Budget becomes merely a set of numbers. Yours faithfully, Norman Whittaker Former Minister of Local Government and Regional Development.