The Ministry of Local Government has refuted allegations that the continued delay in the payment of salaries for Local Authorities’ employees is largely caused by late and untimely release of the Local Government Equalization Fund – LGEF.
Minister of Local Government Charles Banda has explained that the delayed payment of salaries by Local council Employees should not be attributed to the delayed disbursement of LGEF as it is a failure to raise local revenues.
Speaking on October 23, 2019 to the Zambian Business Times – ZBT, Banda said the Local Authorities are expected to raise revenues and funds from levies, fees, charges, local taxes, permits among other revenues pursuant to the local authority Act as the LGEF is a supplementary fund.
He said the LGEF Act provides that local authorities shall use 20% of the fund to finance capital expenditure hence the implications that local authorities are not expected to solely depend on the LGEF to finance functions and salaries.
Banda added that government has consistently disbursed funds to all 116 local authorities from January to August 2019 worth K776, 374, 408. “Government has also put in place a mechanism that prioritizes disbursement to the identified 68 vulnerable local authorities that mainly depend on the grant to implement local authorities’ functions,” he said.
The minister has since stated that there is no need for local authorities to go on a go-slow as it disrupts service provision and industrial harmony. He has since directed all principal officers to submit reports to the ministry of local government on all employees participating in the go-slow in their respective local authorities.
Local Authorities seem to have become dependent on central government funding, when you look at the councils in major cities and towns across Zambia, you will find for instance unregistered taxis, town centre and city parking fees being collected by non council youths and a lot of business levies being issued and funds paid unaccounted for leading to massive revenue leakages.
Moreover, the councils have not been able to find solutions to collecting land and property rates due to political interference. The local government function in Zambia suffers from a historical centralization of key economic functions which seem to have led to a dependency on central government.
Some of the key revenue driver base such as council houses were sold off to sitting Tennant’s and councils have not been recapitalized after this huge sell out of their revenue earning asset base. There is need for capital injection into the local authorities to enable their revenue earning potential to be realized.
