Parliament calls for more efficiency in disbursing devolution funds

by | Feb 16, 2022 | Local News, Politics | 0 comments

Parliament calls for more efficiency in disbursing devolution funds



Pretty Manyewe


The Portfolio Committee on Local Government, Public Works, National Housing and Social Amenities has saluted the Second Republic for implementing the constitutional provision of devolution.

In a recent report on how devolution has gone so far, the parliamentary committee said it has seen more progress since 2018, than it did between 2013 and 2018.

Despite the progress, the committee noted that there could be more progress is bottlenecks are eradicated.

“Disbursements from the central government were unpredictable and this affected the

timely planning and utilization of the devolution funds which further affected the procurement processes since prices kept changing.

Before the introduction of the foreign currency auction system, foreign currency exchange rates were volatile and this made procurement further complicated,” the report said.

There were calls for a clear law which governs how devolution procurement can be made smoother.

“ The lack of a devolution legislative framework has resulted in widespread

bottlenecks in the operationalization of devolution and the subsequent utilisation of the devolution funds.

The Councils bemoaned the lengthy procurement process which has negatively

impacted on the pricing of goods and services. In most cases, the local authorities highlighted that after receiving invoices from the suppliers, it is sent to the Ministry of Finance and Economic Development which has to approve the purchase and then disburse the funds to the local authorities for onward payment to the suppliers. This process, as it was highlighted, may take over a month,” wrote the Committee.

Another complication listed was that Devolution funds are not exempted from Intermediated Money Transfer Tax.

Resultantly, with each quotation received, Council has to pay 2%.

This is on top of

other taxes and services charges which in most cases amount to 6% of the

disbursement to the local authorities.

“There were widespread delays in delivery of imported equipment due to the COVID-19 pandemic. Local authorities bemoaned the lack of capacity by local contractors to produce or

provide the various goods services. Resultantly, the local authorities have resorted to procuring the goods and services from foreign contractors who require payment in foreign currency yet the local authorities can not accept the foreign currency,” the report stated.