Local Government Equalisation Fund, a Brief
By Emmanuel Mwamba
I have repeatedly heard that the former government was not funding local authorities and the equalization fund was not being released.
During the Kenneth Kaunda Day, President Hakainde Hichilema engaged in some cleaning exercise in town.
During his interaction with the media, he repeated the assertions that the Patriotic Front Government was not releasing funding to the Councils and therefore left arrears.
Is this true?
The Local Government Equalization Fund (LGEF) is released as a grant by the Government every month to help the Councils provide services as well as meet staff obligations.
It was first introduced by the Patriotic Front government.
This is a supplementary fund to Councils’ locally generated revenues.
The Councils are guided to use 20% of the grant on Capital Projects. The guidelines state that the other 80% can be used on any operational cost including salaries.
The LGEF was largely meant to help councils with low revenue base as they were unable to meet salary costs for qualified staff.
At the time of change of government, the Patriotic Front government was not in arrears of this fund to any Council.
However there were arrears for a few Councils that may be behind.
Let me explain.
This lies in their inability to raise adequate locally generated funds to top up on Equalization Fund.
Let’s take for example, the Lusaka City Council Local Government Equalization Fund.
Lusaka City Council receives about K4million per month.
Their wage bill is however, over K22m!
In this case, the difference should not come from government but from internally generated funds in property rates, licences, bill boards, etc.
And in the event that the Council fails to raise the difference, it falls into arreas.