Own Source Revenue Slippage in Tanzania’s Local Government Authorities (LGAs), Trend, Challenge and Impact: Evidence from Magu District Council.

Abstract

In the last two decades Tanzania government has employed a great effort on improving revenue collection to its local authorities. The efforts included couples of reform programmes such as; local government reform Programme (LGRP), Legal sector reform Programme (LSRP), Public finances reform Programme (PFRP) and Public service reform Programme (PSRP). These reform programmes intended to improve governance and service delivery by proper mobilization of the resources of local government authorities (LGAs). Improving Own Source Revenue collection in local government authorities (LGAs) was the key agenda of these reforms. Some studies suggest that, steps have been made in some of local government authorities, despite the fact that none of the local authorities has been able to meet the targeted Own Source Revenue collection. Also, the pattern trend of budgeted against actual collection in most of local authorities is not promising. Gathering Primary evidence from Magu district council supported by secondary data from other local authorities in the united republic of Tanzania, the study has analyzed the trend, challenges and impact of Own Source Revenue slippage in Tanzania`s local government authorities (LGAs). A sample of 300 respondents was were randomly selected to fill questionnaires from stakeholders Magu district council. Also, the secondary data from Magu district council and other local authorities in Tanzania were used to fulfil the purpose of the study.The paper Concludes that, own Sources revenue for local government authority (LGAs) in Tanzania are many; actual versus approved budget own source collection trend is not impressing, slippage of above 30 % in revenue collection at Magu district council and up 13% country wide (slippage for all LGAs in Tanzania) has been average in five years. Slippage has already brought severe consequences to the local authority and its community like, poor service delivery in heath sector and education and poor infrastructures in LGAs; if not checked will bring more. The central government dependency at Magu district council is above 80%, to the extent that, it cannot finance its recurrent expenditure. Most of development projects have failed and others are at critical stage of failure. Also, the paper recommends that the Central Government through the PMO-RALG should make sure it reviews the previous and current local revenue system to make sure that it supports the local Councils to increase enough local revenues and in the task of reviewing, representatives from each local Council must attend to make participatory. Also, the government should revise the outdated by-laws   ensuring charges are persistent with the current economic conditions, for instance after every 5 years.

Keywords: local government authorities (LGAs), Revenue slippage, trend. Challenge, Impact