Local govt should get authority to earn, spend

The financial capability and autonomy of local government should be increased if their accountability is to be ensured, speakers told an opinion sharing meeting yesterday.

"Local government should be given the authority to retain and spend locally earned revenues subject to prescribed legal restrictions," said public sector finance specialist Golam Mustafa, based on his research, "Role of Financial Audit and Relevant Institutions for Establishing Effective Local Government".

The findings were presented during the meeting at The Daily Star Centre, organised by Governance Advocacy Forum, a platform of NGOs, with support from Manusher Jonno Foundation. 

"Union Parishads get only 1 percent of the land transfer registration fee, but why could it not be 50 percent?" said Mohsin Ali, coordinator of Governance Advocacy Forum and executive director of Wave Foundation, stressing the need for increasing the earning of local government bodies.

"The budgets of Union Parishads are so small that carrying out their audits by the Office of the Comptroller and Auditor General (OCAG) is often not cost efficient," said the researcher.

Pointing out the limitation of OCAG, Comptroller and Auditor General Masud Ahmed said, "OCAG carries out the audit of 15 lakh government entities with a workforce of only 14,000."

Wahida Hamid, director, Local and Revenue Audit Directorate, OCAG, said audit objections were often neglected by local government bodies and about 70,000 audit objections remained unresolved.

Explaining why OCAG mostly carries out financial compliance audits in local government bodies, she said if it did not, the government would have lost a huge amount of treasury income.

"Between January 1 and December 1 this year, OCAG through its audits was able to collect more than Tk 41 crore un-deposited government revenue," she informed.

Prof Tofail Ahmed, local government expert, and director, Manusher Jonno Foundation, who chaired the event, said besides local government, the comptroller and auditor general should also be empowered.

Other recommendations that came up in the report and the discussion included establishing internal audit mechanism in local government bodies, giving emphasis on a comprehensive audit taking both compliance and performance into account, training of local government bodies on the subject, modernisation of OCAG's audit methods, and use of digitalised accounting methods by local government bodies.

Md Mahatab Uddin, director general of Local and Revenue Audit Directorate, OCAG, also spoke.