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                   THE REPUBLIC OF UGANDA


       The Ministry of Local Government


       Local Government Sector Investment Plan
                          (LGSIP)




         Annual Progress Report for FY 2008/09




October 30, 2009
TABLE OF CONTENTS

      TABLE OF CONTENTS ..................................................................................................................... II
      ABBREVIATIONS....................................................................................................................................... III

1.0            INTRODUCTION ........................................................................................................................... 4
      1.1      BACKGROUND ................................................................................................................................ 4
      1.2      REPORTING PERIOD ........................................................................................................................ 5
      1.3      SYNOPSIS OF FUNDING AND EXPENDITURE LEVELS................................................................................ 5

2.0            HIGHLIGHTS ON ACHIEVEMENTS ............................................................................................... 7
      2.1      THE COMMON RESULTS MATRIX KEY PERFORMANCE INDICATORS............................................................ 7
      2.2      SERVICE DELIVERY.......................................................................................................................... 9
      2.3      POLITICAL DECENTRALISATION ........................................................................................................ 12
      2.4      ADMINISTRATIVE DECENTRALISATION ................................................................................................ 14
      2.5      FISCAL DECENTRALISATION............................................................................................................. 18
      2.6      GOOD GOVERNANCE ..................................................................................................................... 23
      2.7      LOCAL ECONOMIC DEVELOPMENT (LED) ........................................................................................... 24

3.0            CHALLENGES AND MITIGATION MEASURES ............................................................................ 26

4.0            LESSONS AND RECOMMENDATIONS ....................................................................................... 28
      4.1      KEY LESSONS .............................................................................................................................. 28
      4.2      KEY RECOMMENDATIONS ................................................................................................................ 30

ANNEX 1: THE COMMON RESULTS MATRIX ............................................................................................ 31

ANNEX 2: LDG RELEASES TO LGS FROM THE BASKET FUND ............................................................... 37

ANNEX 3: PERFORMANCE OF NEW TAXES (LST AND LHT) IN 2008/09 ................................................... 39

ANNEX 4: TREND IN LOCAL REVENUE PERFORMANCE (SHS'000) ......................................................... 43

ANNEX 5: PERFORMANCE OF LGS IN THE NATIONAL ASSESSMENT 2008 ............................................ 43

ANNEX 6: STATUS OF IMPLEMENTATION OF JARD 2008 UNDERTAKINGS ............................................. 44

ANNEX 7: STATUS OF IMPLEMENTATION OF JARD 2008 RECOMMENDATIONS ..................................... 46




                                                                                                                                                           ii
Abbreviations
BFP             Budget Framework Paper
CAO             Chief Administrative Officer
CB              Capacity Building
CDD             Community Driven Development
CIS             Community Information System
CPA             Certified Public Accountants
DCO             Donor Coordination Office
DPSF            Decentralisation Policy Strategic Framework
DSC             District Service Commission
DSWG            Decentralisation Secretor Working Group
DUA             District and Urban Administration
F&A             Finance and Administration
FDS             Fiscal Decentralisation Strategy
FY              Financial Year
HLG             Higher Local Government
HPPG            Harmonised Participatory Planning Guide
IEC             Information, Education and Communication
ICT             Information Communication Technology
JARD            Joint Annual Review of Decentralisation
JFA             Joint Financing Agreement
KPI             Key Performance Indicator
LAI             Local Authorities Inspection
LCD             Local Councils Development
LCC             Local Council Courts
LG              Local Government
LGA             Local Government Act
LGDP            Local Government Development Programme
LGFAR           Local Government Finance and Accounting Regulations
LGFC            Local Government Finance Commission
LGPAC           Local Government Public Accounts Committee
LGSIP           Local Government Sector Investment Plan
LLG             Lower Local Government
LRECC           Local Revenue Enhancement Coordinating Committee
LST             Local Service Tax
LHT             Local Hotel Tax
MTEF            Medium Term Expenditure Framework
M&E             Monitoring and Evaluation
MoLG            Ministry of Local Government
MoU             Memorandum of Understanding
NAT             National Assessment Team
PEAP            Poverty Eradication Action Plan
PPD             Policy and Planning Division
PPP             Public Private Partnership
PS/ST           Permanent Secretary and Secretary to the Treasury
RDC             Resident District Commissioner
ROM             Result Oriented Management
TWG             Technical Working Group
UAAU            Urban Authorities Association of Uganda
ULGA            Uganda Local Governments Association
SWAP            Sector Wide Approach




                                                                      iii
1.0     Introduction

1.1     Background

The Local Government Sector is in the fourth year of implementing a 10-year Local
Government Sector Investment Plan (LGSIP), which covers the period 2006-2016. The LGSIP
is an elaborate framework for planning, prioritising, coordination and implementing strategic
interventions geared towards deepening the implementation of the decentralisation policy. The
LGSIP is being operationalised through three-year rolling budgets guided by 3 core objectives
being to: provide a single point of reference for mobilising resources for implementation of the
decentralisation policy within the context of the MTEF; ensure that resources are channelled to
core programmes and activities to support the implementation of the decentralisation policy in
line with the PEAP; and to ensure coordinated and effective delivery of services at local level.

The implementation of the LGSIP is intended to contribute to the attainment of results in six key
thematic areas by:

a) Increasing efficiency and effectiveness of service delivery by LGs;
b) Enhancing political accountability in local governments;
c) Ensuring efficient and effective LG administrations;
d) Strengthening financial capacity of LGs to carryout their mandates;
e) Ensuring citizens exercise their rights and fulfil their obligations with respect to local
   governance and service delivery;
f) Creating a conducive environment for investment to promote local economic development

The implementation of the LGSIP brings to the centre all the key stakeholders in the LG sector
including the Ministry of Local Government (MoLG), Local Government Finance Commission
(LGFC), Uganda Local Governments Association (ULGA), Urban Authorities Association of
Uganda (UAAU) and the Local Governments.

For effective implementation of the LGSIP, Government and development partners in the
sector signed a Memorandum of Understanding (MoU) whose main objectives include
establishing a common collaboration framework for joint support and financing of the LGSIP
including the management of multi and bilateral aid relationships and promoting the broad
decentralisation objectives. Further to this, Government and the Development Partners
assented to the Joint Financing Agreement (JFA) for earmarked sector support for the
implementation of the LGSIP via a Sector Wide Approach (SWAP) spelling out the
implementation modalities and obligations of the various parties.




                                                                                               4
1.2       Reporting Period
This report covers the period 1st July 2008 to 30th June 2009. The content and scope are the
activities implemented in the annual work plan 2008/09 using funds availed to the LG sector for
LGSIP basket funded activities.

1.3    Synopsis of Funding and Expenditure Levels
Table 1.1 below shows that no funds were released to the holding account during the FY
2008/09 under the basket funding.

Table 1.1: Funds released to the holding account in FY 2008/09

Source                         Amount (Euros)
Balance B/F                                                     5,910,605.65
Royal Netherlands Embassy                                                  0
Ireland Embassy                                                            0
Austria                                                                    0
Royal Belgium Embassy                                           1,000,000.00
Royal Danish Embassy                                            1,699,800.00
Total                                                           8,610,405.65


The amount of funds transferred from the holding account to the expense accounts of both the
MoLG and LGFC as at 30th June 2009 is summarised in table 1.2 below.

Table 1.2:      Status of the expense accounts as at 30th June 2009

 Implementing        Balance B/F      Release during the     Amount Spent      Balance C/F
 Agency                               FY

 MoLG                5,172,483,588        16,025,001,100 16,535,369,390          4,662,115,298

 LGFC                3,104,822,650          1,205,500,000     2,724,678,672 1,585,643,978**
 TOTAL                                    17,230,501,100 21,123,747,937

**This balance included an amount of Shs 1,529,309,707/= (over-released) that was refunded.
This leaves a balance of Shs 56,334,271/= C/F to FY 2009/10.




                                                                                              5
Table 1.3 below shows the LGSIP expenditures in the different thematic areas. The activities
under the service delivery accounted for 40% of the total expenditure followed by administrative
decentralisation with 25%. Fiscal decentralisation accounted for 26%. Activities implemented
under political decentralisation, good governance and local economic development together
contributed only 10% of the total expenditure.

Table 1.3:      Status of expenditures in the thematic areas

                                             Balance       Total Funds                             %
 Thematic areas            Releases          B/F           Available          Expenditure          expenditure

 Service Delivery           7,292,249,818                                         8,432,992,429          40%
 Political
 Decentralisation             189,550,820                                           189,550,820           1%
 Administrative
 Decentralisation           4,712,781,976                    267,003,794**        5,354,349,621          25%

 Fiscal Decentralisation    3,416,937,807                  2,316,785,117**        5,395,136,984          26%

 Good Governance              909,664,197                    192,000,000**          968,527,440           5%
 Local Economic
 Development                  709,316,482                                           783,190,643           4%

 Total                     17,230,501,100                                       21,123,747,937          100%


** LGFC expenditures on thematic areas




                                                                                              6
2.0        Highlights on Achievements


2.1        The Common Results Matrix Key Performance Indicators

A number of achievements were registered by the end of the fourth quarter of FY 2008/09. The
achievements are monitored using the common results matrix (CRM) which is in Annex 1. The
CRM is updated whenever data becomes available through out the throughout the financial
year.

For key performance indicators whose results are derived from the national assessments of
LGs for minimum conditions and performance measures, further analysis of the results is
carried out to assess performance. While the national assessment considers a score of 7 and
above as a bonus, the CRM key performance indicator is considered achieved only with a
score of 9 and above. The achievements as at the end of quarter 3 2008/09 are as below:

      1)      The 3rd integrity survey conducted by the Inspectorate of Government reported that
              76% of the house holds were satisfied with the quality of services delivered by the
              LGs. This achievement, which is much greater than the targeted value of 60%,
              was a result of the lessened tax obligations enjoyed by the households in the LGs.
      2)      The percentage of LGs with functional structures to mainstream and coordinate
              HIV/AIDS prevention activities fell from 54% in 2007/08 to 49% in 2008/09. The fall
              is attributed to the late support that the LGs received in this area;
      3)       The percentage of LGs that had their gender and environment issues integrated in
              the LG plans and BFP rose from 33% in 2007/08 to 38% in 2008/09. The
              increment is a result of the technical support that was extended to the LGs in this
              critical area. However, this achievement is still far below the targeted value of 70%;
      4)      The percentage of councils adhering to the established standard rose from 61% in
              2007/08 to 67% in 2008/09. This increase is a result of the orientation and support
              on the standard rules and procedures that were extended to the LGs. Much as
              there was an increase, this was still less than the targeted estimate of 88%;
      5)      The percentage of the new MoLG structure that has been filled has increased from
              63% in 2007/08 to 67% in 2008/09. This however, is still below the targeted
              percentage of 95 for the year;
      6)      64% of the LGs have key strategic posts in their new structures operational. In the
              urban councils the percentage is 81 while in the rural it is 61. This is less than the
              targeted value of 90% and also a fall from 64% in 2007/08. The fall is a result of
              the high turn over were LG officials are leaving LG jobs to the more lucrative short
              term NGO occupations as noted in the Joint Monitoring Mission conducted last
              year;
      7)      The percentage of LGs with capacity building plans that meet the national criteria
              rose from 96% in 2007/08 to 97% in 2008/09. This achievement is higher than the
              targeted value of 90%. The good performance in this area is a result of the support
              extended to the human resource and development units by the capacity building
              unit in conjunction with the technical working groups;



                                                                                                  7
    8)      The percentage of LGs publishing financial transfers and budgets rose from 43%
            in 2007/08 to 48% in 2008/09. This increment was however much less than the
            targeted value of 95%;
    9)      There has been no change in the percentage of citizens paying direct local taxes
            between 2007/08 and 2008/09. This percentage still stands at 5%;
    10)     The number of HLGs with functional CSO networks has also remained at 60%
            between 2007/08 and 2008/09;
    11)     The percentage of LGs that have ratified and are implementing the charter of
            accountability and code of conduct has increased from 5% in 2007/08 to 7% in
            2008/09. This is much less than the targeted value of 80%. The poor performance
            in this area is because the charter has not yet been rolled out to the municipal
            councils, sub counties and town councils. Of the 80 districts where the charter has
            been rolled, 75 or 94% have ratified and are implementing the charter;
    12)     The national service delivery survey 2008, reported that 78% of the households
            were satisfied with the performance of the local councils. This is 3% less than the
            expected target for the year;
    13)     97% of the households knew of the LCs as responsible for arbitration of conflicts.
            This is just one areas of responsibility of the LCs. There is need for this information
            for all areas of responsibility;
    14)     28% of fiscal transfers were allocated to the non-wage recurrent budget, which is
            higher than the targeted value of 27%;
    15)     81% of fiscal transfers to LGs were conditional and earmarked. This was higher
            than the targeted value of 70% for the FY;
    16)     The community information system (CIS) has been rolled to 28 districts. This
            represents 35% of all the districts. In these 28 districts, the CIS is operational in all
            the sub-counties. Though this percentage is less than the targeted value of 80% it
            is still an improvement from 21% in 2007/08. This increment can be explained by
            the very close link between the CIS and the “bona bagagawale” program of
            government.


The achievements registered above, which were made possible because of the strategic
interventions implemented in the different thematic areas below, suggest the need to revise the
targets set for each of the indicators.




                                                                                                   8
2.2     Service Delivery

The strategic objective of the service delivery thematic area is to increase efficiency and
effectiveness in service delivery by LGs. The outputs below were registered during the FY:

1) Local Development Grant:
   During the FY 2008/09 a total of 6.25 billion shillings was disbursed to the 80 districts and
   13 municipal councils from the LGSIP basket account as Local Development Grant (LDG).
   Of these funds, 3.2billion were disbursed in quarter 2 while 3.05billion were disbursed in
   quarter 4. Funds disbursed in quarter 4 were based on an allocation formula that takes into
   consideration the population, land area and poverty count in the case of districts and
   population and poverty count in the case of municipal councils. The use of the formula was
   an improvement from the way funds were allocated in quarter 2.
   The LDG was to be used to fund unfunded priorities in the 3 year development plans that
   target local economic development and poverty reduction in the area of infrastructure
   development. Preliminary reports received from the LGs that have utilized the resources
   indicate that the funds were utilised as per the guidelines. Wakiso district which received
   about 80million shillings, for example used the funds for construction of the agro
   processing industry in Namulonge-Busukuma Sub County which was identified and
   approved by the council in line with the government policy of enhancing growth, generating
   employment, achieving prosperity and delivery of quality services. A number of LGs that
   received the funds in quarter 4 were not able to utilise the funds before the end of the
   financial year.Annex shows some of the investments carried out by the LGs. The
   disbursement schedule of the funds is attached in Annex 2. In the FY 2009/10 funds
   amounting to 9billion shillings have been earmarked as LDG from the basket fund.

2) Purchase of motor cycles for District Inspectors of Schools:
   One hundred seven of the one hundred seventy eight motor cycles procured from M/s top
   company (U) limited were supplied and distributed to Inspectors of Schools.

3) Procurement of two vehicles for the Urban Administration Department:
   The Urban Administration Department was facilitated with two vehicles; one double cabin
   pickup and a station wagon. The vehicles have improved the department’s ability to
   supervise and monitor the urban councils..

4) Implementation of LoGICS
      Rollout of LoGICS GIS
      LoGICS plus was rolled out to the districts of Mpigi, Mukono, Kapchorwa, Pallisa and
      Dokolo while follow-up support for LoGICS Plus GIS was extended to the districts of
      Bududa, Mayuge, Apac, Masindi, Bundibugyo, Kasese, Ibanda, Kiruhura, Jinja, Bulisa,
      Lyantonde, Masaka, Soroti and Kumi. The support extended covered the installation of
      the LoGICS Plus and sensitised of the HODs and other LG staff on its use.

      Development of LoGICS module on FDS
       A consultant, M/s Ecraft Systems Ltd, was contracted to incorporate the FDS reporting
       tool for LGs into LoGICS. The consultant completed the assignment and now LoGICS
       is able to capture budgets and work plans from LGs. LoGICS has been installed in
       LGFC which will use it for analysis of work plans and budgets.




                                                                                              9
      Support implementation of LoGICS in PRDP Districts
       LoGICS was enhanced to address the technical challenges that were being faced by
       users of the system. The enhanced LoGICS, known as LoGICS 2009 is now easy to
       install, to use and to generate reports. It runs across various windows platforms
       perfectly well. LoGICS 2009 will be rolled out to all LGs in FY 09/10 and will be used to
       handle reporting requirements for LGMSD and NUSSAF II projects. Requests for
       support and backstopping were received and extended to PRDP districts of Pader,
       Kitgum, Arua, Koboko, Amuria and Soroti in preparation for their reporting
       requirements. The support extended to these districts included:
                  Installation of LoGICS 2009 in all departments of the selected PRDP
                    Districts above;
                  Sensitisation of all HoDs and Planning Unit staff on the benefits and new
                    features of LoGICS 2009;
                  Identification and generation of maps and reports;
                  Training users on the use of modules for service delivery, compliance
                    inspection, project cycle management; LoGICS financials, LoGICS GIS;
                    reports; and basic systems administration (such as data import/export),
                    generation of district, division, town council, sub county, ward and parish
                    maps


5) Provision of 13 garbage trucks to the 13 municipalities:
   Thirteen garbage trucks were procured and allocated to 13 municipalities to facilitate
   proper and timely garbage collection and disposal. The municipalities that received the
   trucks were: Arua, Gulu, Lira, Soroti, Tororo, Moroto, Jinja, Masaka, Mbarara and Fort-
   Portal. Mbale, Kabale and Entebbe municipalities did not receive any of these trucks
   because the garbage trucks that they were allocated in 2007, as the country was preparing
   to host CHOGM, were still in good condition. The remaining three trucks were therefore
   allocated to Hoima, Kasese and Kyenjojo town councils.

6) Implementation of e-government in MoLG:
   MTN was awarded a contract for the provision of Internet bandwidth to the MoLG for one
   year. The Internet service provided is reliable and has improved communication between
   MoLG and other stakeholders.

7) Support LGs to integrate gender and environment in their plans and BFPs:
   During the FY, 124 selected participants from Lower and Higher Local Governments
   technical planning committees of 5LGs were trained on the integration of cross cutting
   issues of gender, environment and HIV/AIDS into plans and budgets.

8) District and MoLG websites:
   Websites were designed and hosted for two districts of Rakai and Amuria while the MoLG
   web site was redesigned. Hosting charges for one year were paid for the MoLG website.
   The web sites are a vital tool in publishing and disseminating information on the
   decentralisation policy.

9) Qualitative studies on upgrading selected urban centres to town councils:
   Studies for upgrading urban centres to town councils were undertaken in the districts of
   Nakaseke, Kiboga, Bulisa, Mbale, Iganga, Isingiro, Kabarole and Sironko. The studies
   involved meeting with stakeholders, field visits and technical verification in the LGs that


                                                                                             10
    requested for town councils. The studies are expected to result in proper planning and
    management in urban councils.

10) Orientation of new members of Town Boards:
    Two orientation meetings were held for new members of town boards from six districts; one
    in Mbale and the other in Masaka district. The meetings were meant to enhance capacities
    of town boards to enable them deliver quality services to the town board communities
    through: organised urban growth, clear understanding of their roles, skills in handling
    challenges or urbanisation, relevant policy and legal reforms, development control, urban
    planning and development.


11) Orientation of City, Municipal and Town Councils Town Clerks:
    Town clerks of the City, Municipal and Town Councils of 116 urban LGs attended a
    meeting at Imperial Royal Hotel, Kampala. The meeting enabled the town clerks
    understand their roles in urban growth and equipped them in handling the challenges in
    urbanisation. Commitments were made by the town clerks on implementation of the
    structural plans.

12) Dissemination of Public Private Partnership policy:
    The decentralization governance reform has yielded expanded LGs service delivery
    responsibilities to the extent that they currently absorb approximately 34% of the national
    non-discretionary budget. In spite of the achievements registered with respect to the
    quantity of services delivered by LGs, a number of challenges still remain.
    LGs face capacity challenges and as a result, decentralized services are not being
    delivered in the most equitable, effective and cost effective manner. Moreover, recent
    evidence suggests that meaningful efficiency and effectiveness of decentralized service
    delivery can only be a product of shared effort between LGs and other stakeholders. This
    would enable LGs to harness the complementary resources and expertise available with
    the private sector and other civil society actors. Dissemination of the public-private-
    partnership policy was carried out in Adjuman,Busia,Bushenyi,Hoima, Manafwa and
    Soroto.

13) Minimum standards for service delivery:
    Minimum standards of service delivery for education, water, roads, production and gender
    were finalised. The minimum standards for health and environment will be finalised in FY
    2009/10 before they are disseminated all stakeholders.

14) Road works in selected Urban Councils:
    Six urban councils of Arua MC, Fort Portal MC, Moroto MC, Nebbi TC, Adjumani TC and
    Kira TC received funds totalling to 500million shillings for carrying out road works.
    Preliminary reports indicate that the funds were properly utilised by the urban councils.




                                                                                            11
2.3     Political Decentralisation
The strategic objective of political decentralisation is to enhance political accountability in LGs.
During the FY 2008/09 the following outputs were registered in this area:

1) Study on the creation of new districts:
   Studies were undertaken on the creation of new districts in order to inform the cabinet. The
   studies resulted into proposals to create 13 new districts, 3 new municipalities and 13 new
   town councils. The districts and municipalities to be effective in FY 2009/10 subject to the
   approval of cabinet are:

            a)   Zombo from Nebbi (Okoro County)
            b)   Amudat from Nakapiripirit (Upe County)
            c)   Otuke from Lira (Otuke County)
            d)   Lamwo from Kitgum (Lamwo County)
            e)   Kyegegwa from Kyenjojo (Kyaka County)
            f)   Buikwe from Mukono (Buikwe County)
            g)   Buyende from Kamuli (Budiope County)
            h)   Hoima Municipal Council
            i)   Mukono Municipal Council
            j)   Kasese Municipal Council

 Districts expected to become effective in FY 2010/11 are:
             a) Namayingo from Bugiri (Bukhooli South Constituency)
             b) Luuka from Iganga (Luuka County)
             c) Kiryandongo from Masindi (Kibanda County)
             d) Ntoroko from Bundibugyo (Ntoroko County)
             e) Serere from Soroti (Kasilo and Serere counties)
             f) Mukuju from Tororo (Tororo County)
             g) Kisoko from Tororo (West Budama County).


2) Support to the conference of East African Ministers Responsible for Local
   Governments:
   A two day conference for ministers responsible for LGs in 5 East African states (Burundi,
   Rwanda, Kenya, Tanzania and Uganda) was convened in Kampala from 5th to 6th March
   2009 by GoU in collaboration with the United Nations Department for Economic and Social
   Affairs (UNDESA). The conference strategized on how to harmonise and strengthen
   decentralisation governance to facilitate the achievement of the Millennium Development
   Goals (MDGs).

3) Guidelines on relationship among various leaders at LG level:
   Guidelines on the relationship among CAOs, RDCs and chairpersons were discussed and
   disseminated to all stakeholders. The guidelines have lead to clarity of roles among
   elected and appointed LG leaders which has resulted in reduction of conflicts and harmony
   among LG leaders.

4) Local administration of justice:




                                                                                                 12
    The training of trainers was conducted for Local Council courts official from 17LGs. The
    training has resulted into a resource pool of trainers that will be tasked with training other
    members.

    Through the Justice, Law and Order Sector (JLOS), MoLG is implementing a
    UNDP/UNCDF funded component to enhance local council administration of justice for
    districts in conflict affected Northern Uganda to create legal and human rights awareness
    for the communities. The programme has provided necessary materials like the Local
    Council Courts Guides for use in Local Council Courts and training of the court officials.

5) Technical support supervision of contract committees:
   Support supervision visits were undertaken in 54 HLGs for compliance to the PPDA
   Guidelines. As a result, there is great adherence to the guidelines in evaluation and award
   of contracts by the LGs as evidenced by the results of the 2008 national assessment. The
   results indicate that 91% (73 districts) attained rewards in procurement capacity and
   performance.

6) Arbitration of conflict in LGs:
   MoLG was involved in arbitration of conflicts during the FY 2008/09. Conflicts were
   arbitrated in the districts of Moyo, Maracha-Terego, Kayunga, Mbale, Kaabong and
   Masaka municipalities among others. In a number of cases, the conflicts were between
   appointed and elected leaders. In some districts like Nakaseke and Maracha-Terego local
   leaders were wrangling over the location of the headquarters for their districts. In Marach-
   Terego the wrangling has been going on for the last two years and at the moment, the
   matter is in court. Subsequent action will be determined after the case is disposed of. The
   2008 national service delivery survey reported that 97% of the households knew local
   councils as a place for arbitration or conflict resolution.

7) Joint sensitisation of user committees:
   Two regional trainings were conducted for user committee members from Western and
   Northern Uganda. In the North the trainings were in Lira while in the West they were held in
   Kasese district. Each of the participating districts had one member of the user committees
   from health, water and education. The training created awareness of the user committees
   in supervision, maintenance and sustainability in service delivery.




                                                                                               13
2.4     Administrative Decentralisation
The strategic objective of administrative decentralisation is to ensure efficient and effective LG
administrations. During the FY 2008/09, the following outputs were registered:

1) Technical support supervision and training of District Service Committees (DSCs):
   Training and Induction of 382 newly appointed chairpersons and members of District
   Service Commissions (DSCs) for the districts of Isingiro, Lyantonde, Kaabong, Abim,
   Kabale, Masake, Luwero, Budaka, Koboko, Kisoro, Rakai, Apac, Kyenjojo, Hoima, Kumi,
   Kabarole, Kampala City Council, Nakasongola, Kapchorwa, Manafwa, Kibale, Budibugyo,
   Masindi and Mityana was conducted.

    Technical support was extended to DSCs during meetings held in Mbale and Mukono for
    DSC members, their secretaries and personnel officers. A total of 108 participants
    benefited from the meeting in Mbale while 49 benefited from the meeting in Mukono. The
    technical support meetings led to increased understanding of the roles of DSCs and
    enhanced the capacity of DSCs in handling personnel matters.

2) Orientation and induction of newly appointed DCAOs and some MoLG staff:
   Newly appointed Deputy Chief Administrative Officers (DCAOs) and new staff members to
   the Ministry of Local Government were oriented and inducted into government operations
   and decentralisation. The orientation that was conducted at KCC house hall enabled the
   new staff appreciate the terms and conditions of service in the Uganda Public Service.
   Concepts of “ROM”, the recognition scheme and HIV/AIDS were elaborated so as to
   empower them.

3) Orientation of new district, city and municipal contracts committee members:
   One hundred ten (110) new members of city, district and municipal contracts committees
   received orientation on their operations. The objective of the orientation was to ensure
   efficiency and effectiveness in handling procurement processes in order to promote sound
   climate for value for money.

4) Training and Technical Support to LGPACs.:
   Technical support supervision was undertaken in 70 districts that had operational Local
   Government Public Accounts Committees (LGPACs). In the same period, support in form
   of training was extended to one hundred fifty eight (158) newly appointed members of the
   LGPACs. The support was intended to enhance the accountability and transparency levels
   of the committees.

5) Monitoring JARD 2008, under takings:
   The 5th Joint Annual Review of Decentralisation, JARD 2008, was held under the theme
   “Good Governance and Increasing Incomes: A Key to Local Development” from 3rd to 4th
   December 2008 in Kampala. A total of 290 participants that included development
   partners, Members of parliament, MoLG, line ministries, RDCs, District chairpersons,
   CAOs, Town clerks, sub county chiefs and other invited guests attended. During JARD
   2008, a number of undertakings and recommendations, which will be reported on at the
   next JARD, were agreed to. The implementation of the undertakings and recommendations
   was monitored during the year. Annex 6 shows the status of implementation of the
   undertakings while Annex 7 shows the status of implementation of the recommendations.




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    The annexes show that there has been good progress in implementation. It is hoped that
    by JARD 2009, a number of the targets set will have been met.

6) Support to weak LGs on HRM functions:
   Support was extended to a number of LGs that had weak HRM functions. The weak LGs
   were supported in scheduling of tasks, cascading transfer of skills and mapping of duties to
   performance milestones. The support revealed performance gaps other than those related
   to HRM/D.

7) Exposure and study tours for LGs:
   HRM officers from persistently weak LGS were selected and guided through though
   exposure and study tour to LGs wit good performance on matters relating to performance
   appraisal, capacity building function, “RIM” and good practices.

8) Payroll management Support to LGs:
   Support was extended to LG staff to build and gain capacity on handling the training
   function, payroll- EFT and STP systems, staff performance appraisal and HRM functions.
   The LG staff were taken through the policies, systems and approaches on good and
   proven practices on STP of payroll. The training is expected to result in a reduction on the
   number of LG staff not accessing the payroll, the quality of staff performance appraisal and
   an increase in the number of meetings on performance appraisal between the appraisers
   and subordinates.

9) Procurement of consultant to review LGSIP:
   Bids were received from consultancy firms that responded to the advert for the review of
   LGSIP. An evaluation committee was appointed to evaluate the bids before a No Objection
   to procure the consultant can be sought. The main objective of the review is to examine the
   LGSIP design, implementation, financing, monitoring and evaluation modalities and the
   extent to which its implementation has contributed to the achievement of the LGSIP,
   national and Millennium Development goals and objectives.

10) Operation of sub committees for LGSIP implementation:
    The three thematic sub committees, namely; 1) service delivery and local economic
    development 2) political and administrative decentralisation 3) good governance and fiscal
    decentralisation were operationalised. The sub committees were instrumental in reviewing
    and scrutinising activities that had been proposed for implementation in the draft 2009/10
    annual work plan and budget. The thematic sub committees are credited for the formulation
    of the approved 2009/10 LGSIP annual work plan and budget. The sub committees are
    expected to plan the critical role of reviewing the progress reports on the activities being
    implemented.

11) Supply, installation, configuration and maintenance of a Corporate Antivirus
    Solution for MoLG:
    A Corporate Antivirus Solution with 200 licenses with a validity of 2 years was procured,
    installed and configured for use on MoLG computer network. The computers and 7 servers
    on the network are now protected and secured

12) Dissemination of District and Urban Planning Guides (DUPAG) in Newly Created
    Districts:



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    Since FY 2007/08, MoLG undertook to give newly created districts technical support in the
    area of development planning and budgeting as it was found that most of the staff that was
    recruited in the new districts was either recruits right from college or were formally in the
    private sector. These activities continued in the FY 2008/09 covering the districts of
    Koboko, Pader, Amuria, Manafwa, Budaka, Kotido and Kaboong.

13) National Assessment of Local Governments:
    The 2008 national assessment of LGs for minimum conditions and performance measures
    was completed successfully. The analysis of combined performance shows that out of the
    national total of 1,105 LGs, only 112 LGs earned rewards of which 16 were districts, 5 were
    Municipals and City Divisions, 5 Municipal Divisions and 86 District LLGs.

    A total of 42 LGs were static while 903 were penalised on basis of failure to meet Minimum
    conditions 54 of which were Districts, 11 Municipals and City divisions, 28 Municipal
    Divisions and 925 District LLGs as shown in Annex 5.

    The assessment identified a number of emerging issues some of which are listed below:
           a) The standard of keeping records is declining as many LGs could not produce
              vital documents for verification by the NAT.
           b) Despite a move towards realistic budgeting, some local governments are faced
              with the challenge of meagre revenue collections.
           c) There is a concern of what mode of the Development Plan should be used by
              the LGs. Some districts like Katakwi, Kabarole. Kamwenge, Kyenjojo and
              Lyantonde had adopted a Five Year Development plan format which was
              requirement by the National Planning Authority. However, the Law provides
              that any appropriation of funds by a Council should be through a budget based
              on a three year approved development plan.
           d) There is increasing total disregard for the logical flow of the Development plan
              in relation to the budget. Many LGs approved plans and budgets on the same
              day bringing to question whether the plans were actually analysed.
           e) There is an interesting development of LGs presenting evidence of
              functionality of TPCs in form of minutes of meetings which were reportedly
              held on weekends, public holidays and worse even nonexistent days. This was
              found in the NAT sampled LGs and internally assessed LGs.
           f) It was noted in some LGs that Force Account is being used in total disregard of
              the PPDA procedures. The LGs defaulting these procedures are many, but an
              example was Nebbi District which did not even prepare BoQs for the projects
              reportedly executed on this kind of operation.

14) Basic ICT training skills for LGs:
    Training in basic ICT skills was extended to some selected PRDP districts, namely;
    Nakapiripirit, Adjumani and Lira in order to enable them to effectively manage data and use
    electronic data processing equipments to ensure efficiency in service delivery. Basic ICT
    training for senior, middle and junior level officials was also extended to Kiboga and
    Nakasongola districts. The training enabled officials from the districts appreciate the use of
    ICT. The areas covered during the trainings were:
             a) Basic troubleshooting of a computer including cleaning PCs periodically with
                  antivirus, basic repair and maintenance of computer hardware including
                  dusting, hard disk & memory management, etc;



                                                                                               16
            b) Sensitizing HoDS and other LG officials on the appreciation and need to invest
               in ICTs;
            c) Training in spreadsheets using Ms Excel;
            d) Presentation using PowerPoint;
            e) Training in the use of Internet and e-mail applications and how to share
               information using a LAN;
            f) Information security including use of passwords and user IDs, threats and
               attacks, data backups, antivirus protection, overview of Active Directory, etc.


15) Professional Training of LG Staff:
    One hundred forty one (141) LG staff have been supported to pursue professional and
    career courses at the Uganda Management Institute (UMI), The courses in which the LG
    staff have been supported are: public administration and management (107LG staff),
    human resource management (16LG staff), procurement (8 LG staff) and CIPS (10 LG
    staff). The 2008 national assessment reported that 97% of the districts had functional
    capacity for capacity building planning which is a direct impact of the professional courses
    pursued by the LG staff.




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2.5      Fiscal Decentralisation
The strategic objective of the fiscal decentralisation and LG public finance management is to
strengthen financial capacity of LGs to carry out their mandates. During FY 2008/09, the
following outputs were registered during the third quarter:

1) Sensitization on property rating handbook:
   Workshops intended to enhance revenue from rates and formulate rates payers
   associations were conducted in eleven districts of Masaka, Hoima, Mbale, Arua, Masindi,
   Lira, Soroti, Gulu, Luwero, Nebbi and Kayunga. Over 2,000 rate payers were trained and
   are expected to play a crucial role in increasing the property rate revenue from the current
   level of 27 billion shillings.

2) Induction of LGFC staff and team building:
   The LGFC corporate strategy 2004-2008 was reviewed and a new corporate strategy
   2009/2012 developed and approved. Equally reviewed were the manpower and
   organisational structure in line with the changed decentralisation landscape and other legal
   requirements. The changes are expected to make the commission focused to promote
   equitable distribution and effective mobilisation of financial resources for service delivery in
   LGs. The induction and team building exercise was meant to enable staff and
   commissioners develop cohesiveness in operations, create effective work systems and
   procedures and develop collective responsibility in the effort to achieve the mandated
   functions of the commission.

3) Support implementation of new local taxes and development of regulations:
   In July 2008, the Government of Uganda amended the Local Governments Act and
   introduced two new local taxes namely:- The Local Service Tax (LST), and The Local
   Government Hotel Tax (LHT). The new local taxes took effect on 1 st July 2008, and are
   collected by all Local Governments in the country. During the FY, the Ministry undertook
   complementary activities in LGs to ensure effective and efficient collection and
   administration of the two taxes. The activities undertaken included:- issuing of guidance
   circulars, distributing of the amendments to the Act, radio talk shows, circulating flyers,
   presenting in various forum, advertising in the print media, developing, printing and issuing
   the implementation guidelines, LGs staff orientation and consultation on how best to collect
   LST from commercial farmers. Eight sub-region orientation workshops for over 960 HLG
   technical staffs on the new taxes were under taken.
    During the formulation of the two taxes, they were expected to yield Shs 67.6 billion (Shs
    60 billion from LST and Shs 6.7 billions from LHT) in local revenue in the first year and it
    was anticipated to rise more in the subsequent years.
    Preliminary data available revealed that KCC, 79 districts, 13 municipal councils and 73
    Town Councils collected Shs 3.838 billion from LST and Shs 0.985 billion from LHT,
    making a total of 4.8billion. Kampala City Council alone collected a total of Shs 1.3 billion
    from the two taxes. The total collection from the two taxes is far below the initial projections
    as seen in the summary table 1 below. The preliminary figures on the two new taxes
    appear in Annex 3. Actual amounts collected will be availed after all LGs have finalized
    their final accounts for the FY 2008/09.




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Table 1: Performance of the new taxes (LST and LHT) in 2008/09
                     LST                                     LHT
    LGs              Budgeted            Actual              Budgeted            Actual            Total actual
    Districts           2,809,453,823       1,977,589,325        176,842,851          28,273,102      2,005,862,427
    Town councils        710,217,722         489,663,669         349,361,000         157,242,341       646,906,010
    Municipals          676,729,655         566,649,234           416,472,569        323,797,885       890,447,119
    KCC                 1,156,046,690        804,527,846         729,835,000         475,554,468      1,280,082,314
    Total           5,352,447,890       3,838,430,074       1,672,511,420       984,867,796           4,823,297,870
   Source: LGFC


4) Consultation on LST for commercial farmers:
   During the sub-regional workshop technical officers where consulted on how best to bring
   the farmers into the tax net of LST. The following key principles were generally agreed
   upon:-
       a) A commercial farmer was defined as an individual person either engaged in the
          production of crops or livestock or apiary or forestry or rearing animals or any other
          commodity of agricultural nature for purpose of sale on the market that generates
          monthly average sales of more than Shs 200,000.
       b) An enumeration committee composed of five technical staff at the Lower Local
          Government appointed by the chief executive of the Lower Local Government to
          carry out both the enumeration and assessment of LST for farmers. Local leaders
          of local administrate units will be ex-officials on the committee.
       c) Where a farmer produces more than one crop or livestock, the enumeration and
          assessment shall be based on one major dominant crop or livestock or any other
          agricultural product produced for the market.
       d) Four member of the Appeals Tribunal shall be the RDC, CAO/TC, Head of Finance
          and chairperson for the committee responsible for finance. (As per SI 243-17).
       e) Farmers shall pay the LST once in full between July to December of every
          Financial Year to a lower local government where the farm is located. The period
          between January to June will be used for enumeration, assessment and
          enforcement.
       f) And any farmer or person who is eligible or may wish to pay LST will register with
          the nearest tax office of a local government and pay the appropriate amount.

5) Assess Impact of sector budgets on LGs services
   The assessment of the impact of sector budgets on LG services included: document
   review, design of checklist, consultation with sector ministries (education, health, water,
   roads, gender, environment, agriculture and lands), consultation with a sample of LGs
   (Rukungiri, Kanungu, Kaberamaido, Ibanda, Kasese, Kisoro, Nebbi Ntungamo, Apac,
   Kamuli, Kibaale, Rakai, Tororo and Municipalities of F/Portal MC, Mbarara MC, Lira MC),
   analysis of data and information collected and discussion of the findings and
   recommendations with the stakeholders. Some of the findings were:
       a) The LGs budget performance(budgeted vis a vis released) was fair (over 90%)
           during the period being assessed but the level of service delivery can be improved



                                                                                                      19
             by increasing funding (conditional, unconditional and equalisation grants) to LGs
             following the drastic decline in local revenues;
        b)   The fairly good performance in almost all the sectors is based on the small targets
             rhyming with available small government funding but leaving out very important
             sector activities and priorities unattended to at the same time;
        c)   The departments of finance, planning, internal audit, administration and council
             virtually have no funding and yet they carry out functional activities that coordinate
             and facilitate the rest of other departments. This subsequently impacts on the
             general performance of the rest of the sectors and the whole LG with respect of
             real service delivery;
        d)   Approximately 96% of the LG budgets are composed of grants from the centre
             which undermines the decentralisation policy;
        e)   The current sector key performance indicators do not comprehensively give an
             entire picture of all the important aspects that need to be taken into account for
             each sector.

6) Professional training of LGs accountants:
   The MoLG has continued to support LGs in form of tuition, exam fees, annual subscription
   and registration for LGs' accountants and auditors in professional courses such as ACCA,
   CPAU and ATCU. A total of 923 students 60(ACCA), 773 (CPAU) and 90 (ATCU) are
   currently receiving this support. To date a total of 444 students from the LGs have
   completed the courses as follows: ATC (404), CPA (U) (38), and ACCA (2). Regular
   special inspection of up-country training centres is carried to assess their effectiveness. As
   a result of the training, all the LGs are now able to produce their final accounts in time.

7) Support weak LGs to produce final accounts on time:
   Four hundred eighty (480) accounts staff from LGs that had qualified and disclaimer
   opinions, from the Office of the Auditor General, were mentored in the production of timely
   and quality financial statements.

8) Audit of LGSIP 2007/08 implementation:
   The terms of Joint Financing Agreement mandate the Auditor General to audit the LGSIP
   implementation. Accordingly, the Auditor General Audited the LGSIP implementation for
   the FY 2007/08. Though the audit report gave a “non qualified opinion”, it indicates several
   critical areas that urgently need improvement in order to strengthen financial management
   and control procedures. MoLG has already taken steps to address the areas mentioned in
   the report so as to improve financial management and control. Plans are underway to audit
   the LGSIP 2008/09 implementation.

9) Update Best Practices Manual to include new taxes:
   Consultative meeting on the draft framework for analysing data collected for updating the
   best practices manual were held with sectors and officials from the districts of Ibanda,
   Kasese, Kapchorwa, Mukono, Jinja and Manafwa. The final framework that is being used
   to analyse data for best practices is:
       a) The practice initiated by the LG, should be sustainable and not dependant for its
           success, implementation or resources on any other program or project;
       b) The practice should demonstrate creative use of governmental and or corporate
           powers provided to the LGs by the LG Act.
       c) The initiative should be easily replicable and can progress to the application stage
           in a relatively short timeframe;


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        d) The practice should have operationally demonstrated and proven oven a
           reasonable time period to be an effective response to the identified needs of its
           target beneficiaries;
        e) The practice should have demonstrated level of sustainability;
        f) The practice should not require huge amounts of resources or funding to replicate
           and is easy to implement;
        g) The practice should have the potential to address other needs or deliver services
           beyond those originally targeted or intended.

10) Strengthening land based revenues in 10 Pilot local governments:
    Feedback and validation on the implementation issues of the Land based revenues were
    held with members of technical planning committees, members of executive council and
    representatives of district land boards in 10 LGs. The LGs include Jinja, Mbale, Kabale,
    Arua and Mukono districts, Entebbe, Mbarara and Lira municipal councils, Luwero and
    Kumi town councils. The land based revenues discussed include: property rates, ground
    rent, contribution in lieu of rates from governments and land based charges (processing
    fees, transfer fees, valuation fees, conveyance fees, build plans approval, Building
    inspection fee and survey fee).

    The major finding indicated that:
       a) Land based revenues are feasible in all LGs visited. In the FY 2007/08 the 10 LGs
           above collected a total of UGX 2.3billion from these revenue sources alone. This
           implies an annual potential of UGX40 billion from the land based revenues for all
           the LGs;
       b) A number of land based activities are taking place in LGs but with no record is
           documented except in Entebbe MC that had records and registers regarding
           revenue collected from all land based activities that take place in the municipality;
       c) Councils had valuation rolls that have not been updated since their approval in
           2006;
       d) 50% of the LGs are collecting these revenues by themselves while the rest
           tendered out the management to private collectors;
       e) The rate chargeable as rental value by the councils varies from 4% to 11%.

11) Technical support to develop strategies for local revenue improvements:
    Technical support on prioritisation and selection of best practices for local revenue
    enhancement using the cost benefit analysis method was extended to three districts,
    namely: Ntungamo, Kabale and Bushenyi. The 2008 national assessment reported that the
    three districts had local revenue enhancement plans with clear strategies with estimated
    costs to achieve the estimated revenues. This is a direct result of the technical support
    received.

12) Development of guide for implementation of new taxes:

    The practical guide for the implementation of Local Service Tax and Local Hotel Tax was
    finalised after extensive consultations. Consultations were made with members of District
    Executive Council and Technical Planning Committees of 17 districts, namely: Ntungamo,
    Kabale, Bushenyi, Bukedea, Butaleja, Manafwa, Busia, Kabarole, Mubende, Lira, Nebbi,
    Kasese, Ibanda, Kanungu, Rukungiri, Kamuli and Jinja. The guide has been disseminated
    to these 17 districts and will be disseminated to all LGs during FY 2009/10. The guide



                                                                                             21
    contains the details information on the processes of Enumeration, Registration,
    assessment, collection and enforcement under each of the categories of LST and HT.

13) LOGICS PLUS financial data report generation:
    Audited final accounts for FY 2006/07 and 2007/08, were collected from the LGs in order to
    populate LoGICS financials with revenue and expenditure data for analysis. Data entry was
    halted to allow for fine tuning of the system. However, preliminary data available indicates
    an increase of local revenue of 17% in 2007/08 from the 98billion collected in 2006/07.
    Annex 4 shows the trend in local revenue performance from 2002/03 to 2007/08.

14) Up-grade LOGICS PLUS compliance inspection module:
    The evaluation of proposals submitted for the assignment to upgrade LoGICS Plus
    Compliance Inspection module into a Performance Assessment module was completed
    and the contract was awarded. The assignment was halted pending the completion the
    performance assessment manual.

15) Support the Streamlining of payment and Sharing of Royalties in LGs with resource
    endowments:
    Consultations were made with 17 LGs and central government institutions including
    Uganda Wild Life Authority (UWA), Electricity Regulatory Authority (ERA), Ministry of
    Energy and Minerals Development (MEMD), ESKOM and MoLG aimed at documenting
    practices and issues in the management of royalties so as to inform the modalities for
    sharing of royalties. The exercise revealed the twenty eight (28) LGs benefit from royalties
    of 2.9billion in 2007/08 against the potential of 16.5billion. In FY 2009/10, LGs with natural
    endowments and industrial establishments will receive support so as to collect the royalties
    due to them.




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2.6      Good Governance
The strategic objective of the good governance thematic area is to ensure citizens exercise
their rights and fulfil their obligations with respect to local governance and service delivery. In
FY 2008/09, the outputs below were registered:

1) Annual negotiations on the conditions for grants:
   Six regional consultations were held during the quarter: 2 in Jinja, 2 in Masaka and 2 in Lira
   districts to gather views from LGs that need to be negotiated upon. The issues derived
   from these consultations were the cornerstones of negotiations the agreed position on
   which were then signed between the parties.

2) Strengthening Local Council Courts Administration of Justice:
   Local Council III court officials from 10 districts of Isingiro, Kabale, Kamwenge, Maracha-
   Terego, Sembabule, Mubende, Tororo, Koboko, Kamuli and Kiruhura were trained in order
   to strengthen the Local Council courts administration of justice through: improvement in
   court proceedings, improvement in time taken to hear and dispose of cases and
   improvement in record keeping. The officials that were trained received Local Council
   Court reference materials during the training. The 2008 National Service Delivery Survey
   reported that 78% of the households were satisfied with the local council courts. The local
   council courts were appreciated as a result of the skills they acquired from the trainings.

3) Support local government budget committee (LGBC):
   LGBC provides a forum of both LGs and CG senior officers to discuss issues of fiscal
   decentralization as per the ToRs in the Fiscal Decentralization Strategy. The discussions
   held this quarter include: 1) The draft report on the study on Participatory Budgeting
   System and Financial Capacity of LGs presented by the consultant. 2) The report on
   national annual LGs assessment carried out in November – December 2008. 3)
   Preparation for sector conditional grants negotiations. 4) The status of submission by
   LGBFPs and emerging issues.




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2.7     Local Economic Development (LED)

The strategic objective of the local economic development thematic area is to create a
conducive environment for investment to promote economic development in local areas. During
the FY 2008/09, the following was achieved:

1) Setup activities:
The following set up activities were carried out:
            a) Assessment of the institutional readiness of the HLGs & LLGs for LED. This
                enabled the identification of gaps that need to be filled
            b) Formation of district LED propagation team (LEDPT);
            c) Induction of the district LEDPT members
            d) Sensitisation of elected district leaders on LED;
            e) Selection and formation of the LEDPT in the LLGs. This was done by the
                district LEDPT teams meeting each of the LLG’s TPCs to identify teams;
            f) Orientation of LLGs TPCs including LEDPT and elected leaders on LED;
            g) Appointment of LED focal point persons for each of the LLGs;
            h) Conducted a baseline survey to identify the LED actors in the districts;
            i) Established communication linkage with the various LED actors (PSO’s CSO’s
                and farmers associations in districts.

2) Establishment of the National Gender Resource Team
   The National Gender Resource Team (NGRT) was inaugurated. The NGRT has been
   established to strengthen the MGLSD’s efforts in providing leadership in gender
   mainstreaming and eventual attainment of gender equity in LED.  NGRT was oriented
   on LED as well as the Third District Development Programme (DDP III). The team is now
   ready to guide, offer technical backstopping and mentor the LED promotion actors on
   issues of gender mainstreaming.

3) Rehabilitation of community access roads
   Nine hundred (900) Km of community access roads have been fully rehabilitated in this FY.
   This is less than the targeted 1000 Km expected during the period. The slow pace of
   rehabilitation of the roads is a result of two main constraints faced by the contractors.
   Firstly, there is limited availability of road equipment in the country to meet the high
   demand arising from increased road construction works in the country. Secondly, most of
   the civil works commenced during the onset of the rains and this disrupted work on the
   roads. Supervision of the works has been stepped up as a measure to speed up the work.
   The rehabilitation of roads has opened up the previously inaccessible rural areas to
   markets. Produce can be seen along the road side awaiting loading on trucks.

4) Consultancy to design markets and agro processing facilities
   The feasibility study on urban markets captured the attention of development partners who
   have gone ahead to support the consultancy to design markets and agro processing
   facilities. Kagga & Partners was contracted to prepare designs for Rural Markets, Agro-
   processing Facilities, Produce Stores, and Cold Rooms located in the 26 districts. The
   assignment involved carrying out of a needs assessment and an economic analysis for all
   the prioritized markets and agro-processing facilities to justify the investments as well as
   preparation of designs and bid documents.




                                                                                            24
    So far, the bid documents for the markets have been completed and are to be submitted
    for approval. The preparation of the bid documents for the agro-processing facilities is in
    final stages.
    According to the needs assessment report, the size of the markets, in the terms of the
    number of stalls and other facilities such as toilets, will vary according to the number of
    vendors operating in the markets. The number of stalls, as determined by the needs
    assessment, ranges from 30 for the small markets to 200 for the big markets. With regard
    to the agro-processing facilities, the decision to invest in a particular type of facility will be
    guided by the economic analysis that was carried out for all the prioritized facilities. On the
    other hand, the capacity of the plants to be procured and installed will depend on the
    volume of agricultural products in the sub county.

5) Training key LG officials on LED initiatives
   Training for key LG officials to track and support LED initiatives for women and youth. Forty
   five (45) officials from five 5 districts and one municipality under DDP III, were oriented on
   how to track and support LED initiatives for women and youth. Participants appreciated the
   centrality of gender equity and equality in achieving economic growth and sustainable
   development in Uganda. They understood and appreciated the concept of LED and its
   context in the DDP III. They also understood the institutional set up for LED in the LGs and
   most importantly they developed Action Plans for implementing the gender equity in LED
   activities and overall LED Action Plans.




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3.0       Challenges and Mitigation Measures

In the implementation of the above activities, the stakeholders encountered some challenges.
This section presents these challenges and describes the mitigation measures that were taken
to offset any eventualities.

      1) While carrying out the 2008 national assessment, the poor condition of roads in many
         districts made travelling across them to selected sub counties very difficult. The poor
         condition of the roads was further worsened by the heavy rains experienced during that
         time, for example in Apac, travelling to Akokokoro Sub County which had been
         sampled was abandoned due to the impassability of the road after a down pour; the
         lack of stable electricity in most districts – especially the west Nile, northern and
         Eastern regions – affected the compilation and submission of district reports in time;
         insecurity in especially in Karamoja also made travelling to some sub counties difficult.
         The team travelling to Moroto for example, found hardship in travelling to Mutany which
         had been sampled due to security concerns.

      2) There was a campaign by political leaders in the districts of Kalangala, Mityana,
         Wakiso and Kampala City Council discouraging and inciting people, hotels
         managers/owners, businesspersons against paying the newly introduce LST and LHT,
         which has seriously undermined collection and affected the proceeds; A number of
         LGs have not exploited their LHT and LST potentials from the self employed and
         practicing professionals, self employed artisans, businesspersons and hotels/lodges in
         small trading canters. The LGs are mostly depending on the employed salary earners;
         LHT and LST yields are more in urban councils than in rural LGs. Some Districts like
         Abim, Kotido and Bukwo reported that, they did not have any hotel in their Districts and
         therefore no LHT was collected; there were isolated cases of non-compliance with the
         law on hotel tax in Kasese and Amuru Districts; Mweya and Para Para Safari Lodges
         were reported to have collected money from the residents and refused to remit LHT to
         Kasese and Amuru Districts respectively.

      3) On the implementation of LoGICS, a number of LGs lacked computers with the
         minimum specifications for installation and use of LoGICS 2009; some LG personnel
         did not have the basic skills for operating computers; some LGs still consider the use
         of LoGICS as additional work and not as part of their routine work, for which they
         demand to be paid; there is still lack of harmonization in data collection by sector MISs
         in LGs resulting into duplication and resources wastage as well as data collection
         fatigue.

      4) On popularising the national LGs skills development strategy political leaders were
         claiming for long term professional courses for which they are not eligible as per the
         national LG capacity building policy.

      5) On support to LG staff to build and gain capacity on the payroll system and staff
         appraisal functions, it was noted that the demand to support LGs on payroll
         management through STP is enormous; the intermittent power supply to some LGs
         complicates payroll management; a number of supervisors view staff performance
         appraisal as wastage of time.




                                                                                               26
6) The difference in professional and work experience of the newly appointed DCAOs
   meant they were at different levels in regard to LG knowledge and public
   administration was a challenge in their orientation and induction; lack of management
   training equipment e.g. CDs, to amplify communication.

7) The failure by some LGs to attract staff to key posts like engineer, personnel, planning
   and DEO and the decline in local revenue has impacted negatively on the support
   supervision capacity of the HRM/D functions in these LGs

8) Much as the thematic sub committees played an important role in analysing and
   scrutinising activities for implementation in the annual work plan, the numerous
   meetings held by the thematic sub committees to achieve consensus on the activities,
   resulted into late submission and approval of the annual work plan and budget.

9) The technical and financial capacity of the private sector is still lacking for meaningful
   implementation of PPP




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4.0       Lessons and Recommendations

4.1    Key Lessons
From the implementation of activities under the LGSIP, some lessons have been learnt and
subsequent recommendations advanced accordingly, as follows:

      1)In the implementation of LoGICS, it was learned that LGs with good leadership and
        management very readily embrace LoGICS and use it for informed decision making while
        those with poor leadership lack appreciation for its use;

      2)The planning and budgeting subcommittee provides a forum for all implementing
        agencies and departments to actively engage each other in the formulation of LGSIP
        programmes. The forum provides an opportunity for the implementing agencies to
        synchronise their planned activities to achieve greater results;

      3)The thematic sub committees provide an opportunity for scrutinizing, analysing and
        harmonising activities for implementation in the decentralisation sector. Much as the
        numerous meetings of the sub committees lead to delays in approval of the work plan
        and budget, the final work plan is harmonised with clear inputs and outputs from all
        stakeholders;

      4)While sensitising LGs on the property rating handbook, it was learned that property
        owners are willing to pay the rates but need to be sensitized for them to know what they
        are contributing to;

      5)In the collection of data on local revenue from LGs, it was learned that there were a
        number of best practices that could be incorporated into the inventory for better
        performance of local revenues;

      6)The initiative to create and gazette town councils will promote organised settlement.
        Small urban councils will also promote decongestion of the big urban councils;

      7)During the formation of rate payers associations in the LGs, it was learned that property
        owners were willing and eager to pay property rates but needed to be sensitised so as to
        know what they were contributing to as far as service delivery was concerned;

      8)While mentoring the LGs accounts staff, it was learned that timing of the mentoring was
        very critical. Mentoring should be given early to allow LGs staff the opportunity to prepare
        final accounts;

      9)A number of LGs have been piloting the PPP, for example in the case of tendering out
        markets for revenue collection. The LGs were, however, not aware of the various forms
        of partnerships that they may gain from.

      10) Computer virus affects staff productivity and is a source of staff frustration in using
        computers;




                                                                                                 28
11) Joint planning for the first phase districts, yielded greater results as well as the idea of
  having a combined workshop to train the key LED actors to track and support LED
  initiatives for women and youth;

12) The induction and orientation of newly appointed staff should be done early before
  deployment. Staff who is joining the administrative cadre for the first time should be
  inducted with a tailor made course in order to fill evident gaps.




                                                                                             29
4.2     Key Recommendations
Arising from the earlier cited implementation challenges and lessons, the following
recommendations are advanced:

   1) Sensitization of technocrats and councillors on the property rating handbook should be
      conducted through out the country so that compliance levels can improve and thus
      increase provision of services;

   2) The thematic, planning and budgeting subcommittee should be institutionalised and
      empowered with skills necessary for improved implementation of LGSIP. A schedule
      for meetings to consider work plans and reports should be drawn so as to have the
      annual work plans and progress reports approved in time;

   3) Local politicians should be sensitized on the LST and LHT implementation guidelines
      to avoid political interference in the future. Sensitization meetings on LHT for hotel
      owners and managers should also be organized in the major urban councils in the
      country. This will help hotel owners and managers to appreciate the LHT guidelines
      better;

   4) A LoGICS TWG comprising all members of NTM&E working group and all sectors
      running MISs in LGs should be established to discuss ways of harmonizing data
      collection, entry and sharing of data sets and overall operationalization of LoGICS in
      LGs. LoGICS should be promoted in the NM&E TWG and adopted as a government
      M&E system and its use in LGs be advocated for at the highest level possible. There is
      also a need to hold quarterly system review meetings in order to share experiences
      from LGs in the use and processing of data using LoGICS as a feedback mechanism
      for MoLG;

   5) All the guidelines available including guidelines on recruitment of LG staff, guidelines
      on upgrading urban authorities should be disseminated to the LGs to enable them
      carry out their work as per the laid down guidelines and in an organised manner. All
      the available material should be posted on the available websites of the implementing
      institutions to facilitate their circulation;

   6) Government should come up with a comprehensive phased strategy on attraction,
      development and retention of staff to LGs filling the acute manpower shortage;

   7) The suggestion to amendment of the LGA so as to increase the rate of LHT per room
      occupied from 500/= to 1,000/= in order to enhance LHT yields particularly in rural
      growth centre and use of bracketed rate of turnover instead of “Stars” should be given
      consideration;

   8) Sensitisation on property rates and formulation of rates payers associations should be
      rolled through out the country so that compliance levels can go up and thus increase
      provision of service.




                                                                                           30
Annex 1: The common results matrix

Key Performance Indictor             2005/06           2007/08                2008/09         Comment on the 2008/09 achievements                    Data Source

                                     Base         Target    Actual       Target    Actual
Thematic Area: Service Delivery:
Strategic Objective: To Increase Efficiency and Effectiveness in Service Delivery by LGs
% LGs meeting service delivery                                                           The service delivery standards are not yet in place.        National assessment report
standards                                            50%           -      60%            This indicator can therefore not be assessed.               '08

% of population satisfied with LG                                                           75.6% of households are satisfied with the quality of    The 3rd National Integrity
services ( Measured by the                                                                  services provided by the LGs as per the 3rd              Survey, October 2008
“general helpfulness” indicator in          53%      55%         76%        60%         76% National Integrity Survey, October 2008.
the IGG Integrity Survey)
% of Higher and Lower LGs with                                                              38 districts and 10 municipal councils had functional    National assessment report
functional structures to                                                                    structures for mainstreaming and coordinating            '08
mainstreaming and co-ordinate               30%      65%         54%        90%         49% HIV/AIDS in LGs. The fall in this percentage is
HIV/AID in the LG Service delivery                                                          explained by the late support that was provided to
system                                                                                      the LGs.
Gender and environment integrated                                                           More districts benefited from technical support          National assessment report
in LG-plans and BFPs                        15%      45%         33%        70%         38% extended by the MoLG in the this area, thus the          '08
                                                                                            increment from 33% to 38%.
% of households utilising the user                                                          To be updated after a study on the user committees       National Service Delivery
committees                                  60%      70%             -        80            is carried out.                                          Survey/D-SWG
Working framework for joint                                                                   Two joint supervision missions were conducted          Inspectorate and sector
supervision missions from                                                                     during the FY. The supervision reports provided        reports
                                            4%       15%             -      30%
ministries to reduce overlaps                                                                 critical input JARD 2008.A joint supervision mission
                                                                                              is planned every quarter in 2009/10




                                                                                                                                                                        31
Key Performance Indictor             2005/06          2007/08              2008/09         Comment on the 2008/09 achievements                    Data Source

                                    Base        Target       Actual   Target  Actual
Thematic Area: Political Decentralisation
Strategic Objective: To enhance political accountability in Local Governments
% of councils adhering to                                                            67% of the councils adhered to the established               National assessment report
established standards                                                                standards. The increase is a result of the orientation       '08
                                           60%      73%         61%      88%     67% and support received on the standard rules of
                                                                                     procedure.
% citizens satisfied with local                                                            National service delivery survey 2008, reported that   National Service Delivery
council performance                      55%        70%           -      81%         78%   78% of the households were satisfied with the local    Survey 2008
                                                                                           councils.
% of LGs that are followed up on                                                           To be updated                                          Inspectorate reports. LG
70% of their audit queries                                                                                                                        PAC reports submitted to
                                         60%        72%         66%      82%                                                                      Standing Committee of
                                                                                                                                                  parliament on LG Public
                                                                                                                                                  Accounts.
Thematic Area: Administrative Decentralisation
Strategic Objective: To ensure efficient and effective local government administrations
% of planned LGSIP policy actions                                                          To be updated                                          JARD, LGSIP CRM &
completed                                  40%        85%          -      90%                                                                     PEMCOM reports
% new structures in MOLG and                                                                67% of the MoLG structure is filled to date.          Payroll
LGFC filled                               N/A       75%         63%      95%         67%
% of higher local governments with                                                        64% of the HLGs have strategic and key posts            LG Human Resource
new structures operational                                                               filled and operational. This percentage varies           Reports
                                         60%        80%         65%      90%         64% between the rural and urban councils with the rural
                                                                                         at 61% and urban at 81%




                                                                                                                                                                    32
Key Performance Indictor             2005/06           2007/08              2008/09         Comment on the 2008/09 achievements                     Data Source

                                     Base         Target   Actual      Target   Actual
% of HLG, CB plans that meet                                                              Hands on support to capacity building planning was        CBG reports, National
National Assessment Criteria                                                              extended to the HR/D units of a number of LGs.            Assessment reports
                                          70%        82%        96%     90%        97% The good performance in this area is a result of the
                                                                                          support extended by the capacity building unit in
                                                                                          conjunction with the technical working groups.
Thematic Area: Fiscal Decentralisation and Local Government Public Financial Management
Strategic Objective: To strengthen financial capacity of Local Governments to carry out their mandates
% of LGs meeting LGPFM                                                                    To be updated                                             Biennial LG PFM
Assessment criteria                       21%        30%           -     N/A                                                                        Assessment
% of LGs producing timely Final                                                             The LGs are required to produce statements of           National assessment report
Accounts                                                                                    financial statements within three months after the      '08
                                                                                            end of each accounting period in accordance with
                                                                                            section 86 of the LGA, cap 243, for submission to
                                                                                            the Auditor General. The financial statements must
                                            70%      90%         91%      95%         64%   include: Trial Balance, Income and Expenditure
                                                                                            Statement, Balance Sheet, Cash flow statement. 54
                                                                                            districts and 10 municipalities were able to meet
                                                                                            this indicator. The HLGs that met the indicator
                                                                                            account for 64% of the HLGs. 33% of the LLGs
                                                                                            were also able to produce the final accounts in time.
% of LG locally generated revenue                                                           Further strategies are required to enhance local        Final Accounts/LOGFIAS
as a share of LG Budgets                    9%       11%         4%       12%               revenue. Finding confirmed by the joint monitoring
                                                                                            mission
% of fiscal transfers allocated to                                                                                                                  National Budget
non-wage recurrent budget                   21%      25%         17%      27%         28%
% of fiscal transfers that are                                                                                                                      National Budget
conditional and earmarked                   78%      73%         87%      70%         81%




                                                                                                                                                                      33
Key Performance Indictor                2005/06           2007/08               2008/09         Comment on the 2008/09 achievements                        Data Source

                                        Base         Target   Actual       Target   Actual
% LLGs audited within the statutory                                                             The means to ensure that all LLGs are audited              National assessment report
period.                                    100%         70%            -      90%               should be identified                                       '08

%of Districts and Municipalities with                                                           All the districts have functional contracts                National assessment report
functional Contracts Committees                70%     100%         61%      100%     100%      committees in place.                                       '08

Thematic Area: Good Governance
Strategic Objective: To ensure citizens exercise their rights and fulfil their obligations with respect to local governance and service delivery
% of LGs implementing National                                                                 To be updated                                     National Integrity survey,
Anti-corruption strategy                  18%        32%            -        42%                                                                 MoLG inspection report
% of LGs experiencing institutional                                                             To be updated                                              National assessment report
dysfunctional due to conflicts                 10%       6%            -       4%                                                                          '08
% of LGs publicising financial                                                                Financial transfers and budgets were displayed in            National assessment report
transfers and budgets                          70%      90%         43%       95%         48% 48% of the LGs.                                              '08
% Citizens aware of the roles and                                                               National service delivery survey 2008 reported that        National Service Delivery
responsibilities of LGs                                                                         97% of the households knew of the LCs as a place           Survey 2008.
                                               70%      80%            -      85%         97%
                                                                                                to go for arbitration of conflicts. There is need to get
                                                                                                figures for all the areas of responsibility
%Eligible citizens paying direct                                                                All formal employees are required to pay direct            Household surveys. MoLG
local taxes.                                   32%      52%         5%        70%         5%    taxes. Approximately 3% of population of working           data/LGFC
                                                                                                age
% of LGs with functional Human                                                                  To be updated                                              HR Commission Surveys.
Rights desks                                   20%      60%            -      80%                                                                          National Assessment
                                                                                                                                                           reports.
No. of HLGs with functional CSO                                                                 60% of HLGs have functional CSO networks                   Inspectorate Reports, CSO
networks                                       15%      42%         60%       60%         60%                                                              survey reports




                                                                                                                                                                             34
Key Performance Indictor               2005/06           2007/08               2008/09        Comment on the 2008/09 achievements                  Data Source

                                       Base         Target   Actual       Target   Actual
% LGs that have ratified, applied                                                           75 of the 80 districts have ratified and are           ULGA surveys
and are implementing the Charter                                                            implementing the charter of accountability and code
                                              20%      70%         5%        80%         7%
of Accountability and Code of                                                               of conduct. The municipal councils, sub counties
Conduct                                                                                     and town councils are yet to ratify the charter.
% Citizens aware of service                                                                 To be updated                                          User Satisfaction Surveys
delivery rights and obligations in            15%      30%            -      60%
key sectors
% of Districts with functional Local                                                          To be updated. However, 2,472 officials from 412     National assessment report
Council Courts.                               70%      80%         44%       90%              sub counties in 35 districts have been trained and   '08 and Adoption survey
                                                                                              equipped to administer local justice.                reports

Thematic Area: Local Economic Development
Strategic Objective: To create a conducive environment for investment to promote economic development in local areas
% of LGs supporting CDD ventures                                                       To be updated.                                              LG Reports
in their budgets                         10%       50%           -      60%
% increase of locally generated                                                        To be updated                                               National assessment report
revenue in LGs through pay of                                                                                                                      '08
direct taxes and revenue                   9%      11%           -      12%
generating ventures.
% growth of private sector                                                             To be updated                                               Private sector growth
investments in LGs.                        5%      15%           -      20%                                                                        surveys.
% of businesses supported through                                                      To be updated                                               LED Surveys
local investment centres                   5%      30%           -      40%




                                                                                                                                                                     35
Key Performance Indictor            2005/06          2007/08              2008/09         Comment on the 2008/09 achievements                   Data Source

                                    Base        Target   Actual      Target   Actual
% of sub-counties with fully                                                            The CIS is operational in all the sub counties of the   Economic Development
operational Community information                                                       28 districts where it has been rolled out. The          Strategy performance
systems (to be synchronised with           NA      60%         21%      80%         35% percentage growth of the CIS utilisation can be         surveys
MoFPED targets)                                                                         explained by its close link to the "bona bagagawale"
                                                                                        program




                                                                                                                                                               36
Annex 2: LDG releases to LGs from the basket fund
No.   Local Government            Qtr2 Release      Qtr4 Release    Total
  1   Abim District                                    46,127,851     46,127,851
  2   Adjumani District                                61,090,552     61,090,552
  3   Amolatar District                                35,323,203     35,323,203
  4   Amuria District               100,000,000               -      100,000,000
  5   Amuru District                                   63,917,887     63,917,887
  6   Apac District                                    69,026,438     69,026,438
  7   Arua District                                    62,829,838     62,829,838
  8   Budaka District                                  34,693,499     34,693,499
  9   Bududa District               100,000,000               -      100,000,000
 10   Bugiri District                                  75,523,438     75,523,438
 11   Bukedea District              100,000,000               -      100,000,000
 12   Bukwa District                100,000,000               -      100,000,000
 13   Buliisa District                                 42,962,434     42,962,434
 14   Bundibugyo District                              45,812,789     45,812,789
 15   Bushenyi District                                76,682,826     76,682,826
 16   Busia District                                   42,638,241     42,638,241
 17   Butaleja District                                38,120,907     38,120,907
 18   Dokolo District               100,000,000               -      100,000,000
 19   Gulu District                                    66,882,849     66,882,849
 20   Hoima District                                   63,122,474     63,122,474
 21   Ibanda District               100,000,000               -      100,000,000
 22   Iganga District               100,000,000               -      100,000,000
 23   Isingiro District                                44,772,790     44,772,790
 24   Jinja District                100,000,000               -      100,000,000
 25   Kaabong District                                 88,048,856     88,048,856
 26   Kabale District                                  48,119,869     48,119,869
 27   Kabarole District             100,000,000               -      100,000,000
 28   Kaberamaido District          100,000,000               -      100,000,000
 29   Kalangala District                               35,222,999     35,222,999
 30   Kaliro District               100,000,000               -      100,000,000
 31   Kampala District                                 91,645,044     91,645,044
 32   Kamuli District               100,000,000               -      100,000,000
 33   Kamwenge District                                44,133,498     44,133,498
 34   Kanungu District              100,000,000               -      100,000,000
 35   Kapchorwa District            100,000,000               -      100,000,000
 36   Kasese District                                  72,866,671     72,866,671
 37   Katakwi District                                 45,838,255     45,838,255
 38   Kayunga District                                 42,427,044     42,427,044
 39   Kibaale District              100,000,000               -      100,000,000
 40   Kiboga District               100,000,000               -      100,000,000
 41   Kiruhura District             100,000,000               -      100,000,000
 42   Kisoro District                                  37,969,304     37,969,304
 43   Kitgum District                                  87,906,347     87,906,347
 44   Koboko District               100,000,000               -      100,000,000
 45   Kotido District                                  50,056,639     50,056,639
 46   Kumi District                 100,000,000               -      100,000,000
 47   Kyenjojo District                                57,894,249     57,894,249
 48   Lira District                                    72,728,567     72,728,567
 49   Luwero District                                  44,957,289     44,957,289



                                                                               37
No.   Local Government           Qtr2 Release    Qtr4 Release    Total
 50   Lyantonde District          100,000,000              -       100,000,000
 51   Manafwa District            100,000,000              -       100,000,000
 52   Masaka District                               72,631,898      72,631,898
 53   Masindi District                              68,849,541      68,849,541
 54   Mayuge District                               60,352,544      60,352,544
 55   Mbale District              100,000,000              -       100,000,000
 56   Mbarara District            100,000,000              -       100,000,000
 57   Mityana District            100,000,000              -       100,000,000
 58   Moroto District                               85,872,576      85,872,576
 59   Moyo District                                 55,403,244      55,403,244
 60   Mpigi District              100,000,000              -       100,000,000
 61   Mubende District                              60,820,406      60,820,406
 62   Mukono District                              106,107,404     106,107,404
 63   Nakapiripirit District                        73,786,565      73,786,565
 64   Nakaseke District                             35,590,254      35,590,254
 65   Nakasongola District                          31,143,003      31,143,003
 66   Namutumba District          100,000,000              -       100,000,000
 67   Nebbi District                                71,386,732      71,386,732
 68   Ntungamo District           100,000,000              -       100,000,000
 69   Nyadri District             100,000,000              -       100,000,000
 70   Oyam District                                 51,755,795      51,755,795
 71   Pader District                                85,498,155      85,498,155
 72   Pallisa District                              59,219,403      59,219,403
 73   Rakai District              100,000,000              -       100,000,000
 74   Rukungiri District          100,000,000              -       100,000,000
 75   Sembabule District          100,000,000              -       100,000,000
 76   Sironko District                              38,554,578      38,554,578
 77   Soroti District                               68,808,235      68,808,235
 78   Tororo District             100,000,000              -       100,000,000
 79   Wakiso District                               80,493,314      80,493,314
 80   Yumbe District                                63,464,099      63,464,099
 81   Arua Municipality                             14,949,274      14,949,274
 82   Entebbe Municipality                          12,851,081      12,851,081
 83   Fort Portal Municipality                      11,487,492      11,487,492
 84   Gulu Municipality                             32,877,438      32,877,438
 85   Jinja Municipality                            14,693,646      14,693,646
 86   Kabale Municipality                           10,213,741      10,213,741
 87   Lira Municipality                             20,114,890      20,114,890
 88   Masaka Municipality                           14,546,488      14,546,488
 89   Mbale Municipality                            15,228,282      15,228,282
 90   Mbarara Municipality                          12,682,086      12,682,086
 91   Moroto Municipality                            7,463,422       7,463,422
 92   Soroti Municipality                           12,857,608      12,857,608
 93   Tororo Municipality                           10,954,162      10,954,162
      Total                      3,200,000,000   3,050,000,000   6,250,000,000




                                                                             38
Annex 3: Performance of new taxes (LST and LHT) in 2008/09
District         LST                                       LHT                                        Total actual
                 Budgeted           Actual                 Budgeted             Actual
Adjumani               25,534,000              3,115,250                 -                        -          3,115,250
Apac                   87,041,851             50,981,897        10,041,851                        -         50,981,897
Arua                   66,000,000             57,460,000         2,000,000                                  57,460,000
Bugiri                 43,000,000             53,019,857                 -                        -         53,019,857
Bushenyi               40,000,000             92,448,250                 -                        -         92,448,250
Busia                  25,670,000             21,100,000                 -                        -         21,100,000
Gulu                            -             12,598,085                 -                        -         12,598,085
Hoima                  85,000,000             20,597,500                 -                        -         20,597,500
Kabale                 30,000,000             24,256,000                 -                        -         24,256,000
Kabarole               70,000,000             44,827,700                 -                        -         44,827,700
Kaberamaido            14,328,750              7,815,682                 -                        -          7,815,682
Kalangala              18,645,000              7,285,714         4,222,000                2,743,714         10,029,428
Kamuli                 22,000,000             67,939,286                 -                        -         67,939,286
Kamwenge               30,400,000             21,340,000           500,000                1,154,000         22,494,000
Kanungu                 9,200,000              8,698,975         5,800,000                2,102,120         10,801,095
Kapchorwa              70,000,000             14,394,000         2,000,000                  221,782         14,615,782
Kasese                 50,000,000             57,553,537                 -                1,000,000         58,553,537
Katakwi                 5,000,000             12,306,273                                          -         12,306,273
Kayunga                42,857,000             49,251,429                    -                     -         49,251,429
Kibale                 15,353,500             11,428,888                                                    11,428,888
Kisoro                  9,001,000             27,948,135             1,000                 364,830          28,312,965
Kitgum                 16,000,000             10,445,000         5,000,000                 110,000          10,555,000
Kotido                  5,000,000                485,000                                                       485,000
Kyejonjo               35,035,000             17,082,500        14,028,000                1,500,000         18,582,500
Lira                            -             16,157,209                 -                        -         16,157,209
Luweo                  50,000,000             40,457,143                 -                        -         40,457,143
Masaka                205,847,750             82,597,000                                                    82,597,000
Masindi                29,000,000             17,342,925         2,500,000                        -         17,342,925
Mayuge                 13,700,000             35,823,038        13,700,000               12,537,775         48,360,813
Mbale                  60,000,000             53,118,818           700,000                  357,000         53,475,818
Mbarara                68,625,000             59,633,582         1,000,000                1,015,000         60,648,582
Moroto                  6,150,000              5,535,000                                                     5,535,000
Moyo                   19,465,000             13,850,000                                                    13,850,000
Mpigi                  20,150,000              2,743,714         4,200,000                1,268,571          4,012,285
Mubende                52,971,000             39,373,925         1,000,000                  290,000         39,663,925
Mukono                185,038,000             65,136,624                 -                        -         65,136,624
Nakapiripiriti          8,000,000              2,304,545         2,000,000                        -          2,304,545
Nakasongola            45,860,000             16,647,857        10,950,000                  705,429         17,353,286
Nebbi                  89,500,000             31,610,214                 -                        -         31,610,214
Pader                  19,134,000             17,291,487                 -                        -         17,291,487
Pallisa                31,714,286             18,510,000                 -                        -         18,510,000
Rakai                  82,500,000             28,800,000                 -                        -         28,800,000
Rukungiri              52,587,500             37,900,000           800,000                  130,500         38,030,500
Sembabule              70,000,000             36,340,714                 -                        -         36,340,714
Sironko                32,760,000             22,605,455                 -                        -         22,605,455
Soroti                 37,750,000                736,364         1,000,000                        -            736,364
Tororo                 57,692,686             49,023,488                 -                                  49,023,488
Wakiso                150,000,000            174,439,697        92,000,000                 658,531         175,098,228
Yumbe                 100,000,000             22,817,250                 -                       -          22,817,250
Butaleja               25,000,000             26,361,000                 -                       -          26,361,000
Ibanda                 26,992,500             20,760,000                 -                       -          20,760,000
Kabong                 12,220,000              5,213,750                                                     5,213,750
Isingiro               22,491,250             22,491,250              600,000              373,850          22,865,100
Kaliro                 14,000,000             23,697,857                    -                    -          23,697,857
Kirihura               60,000,000             30,857,143                    -                    -          30,857,143
Koboko                  9,384,000                353,000                    -                    -             353,000
Amolatar               15,000,000             12,652,000                    -                    -          12,652,000
Amuria                 20,148,000             21,927,273                    -                    -          21,927,273
Manafa                 50,000,000             23,981,018                    -                    -          23,981,018



                                                                                                                     39
District          LST                                        LHT                                       Total actual
Bukwo                      10,000,000         3,515,113                       -                    -           3,515,113
Mityana                    32,000,000        24,570,000                 300,000                    -          24,570,000
Nakaseke                    7,365,750        29,076,257                 200,000               40,000          29,116,257
Amuru                       9,700,000        37,491,961               2,300,000              700,000          38,191,961
Budaka                     37,550,000         7,430,455                       -                    -           7,430,455
Oyam                       35,000,000        25,739,500                       -                    -          25,739,500
Abim                       13,386,000        11,631,500                       -                    -          11,631,500
Namutumba                  18,000,000        15,060,000                       -                    -          15,060,000
Dokolo                     19,005,000        12,000,000                       -            1,000,000          13,000,000
Buliisa                       700,000         1,878,196                                                        1,878,196
Maracha                    33,000,000        27,587,500                                                       27,587,500
Bududa                     35,000,000         8,139,545                       -                 -              8,139,545
Total                   2,783,919,823     1,974,474,075             176,842,851        28,273,102         2,002,747,177



                    LST                                       LHT                                      Total actual
Town councils       Budgeted            Actual                Budgeted            Actual
Abim TC                    12,000,000             720,000            18,177,000             169,500
Amolatar                    5,100,000            4,050,000            5,250,000             130,000
Apac                       12,000,000             720,000            18,177,000             169,500            889,500
Bombo                      10,000,000            7,067,143                 -                    -             7,067,143
Budaka                      2,500,000            1,750,909                 -                    -             1,750,909
Bududa                      2,500,000            1,789,091            1,500,000                 -             1,789,091
Bugiri                     17,500,000        15,910,714               2,012,500             198,857         16,109,571
Bukwo                       3,000,000                 -               2,000,000             109,091            109,091
Bundibugyo                 39,312,000            4,419,692           10,312,000             795,000           5,214,692
Bushenyi Ishaka            30,000,000        22,765,500              10,000,000            3,439,500        26,205,000
Busia                      20,000,000        18,316,364              20,000,000        13,575,545           31,891,909
Dokolo                            -                   -                    -                797,500            797,500
Hima                       22,000,000        22,403,750               1,600,000            1,424,600        23,828,350
Hoima                             -          10,370,750                    -               1,319,000        11,689,750
Ibanda                      8,000,000        13,171,878              12,000,000            1,396,000        14,567,878
Iganga                     18,776,769            7,345,714           20,000,000            6,857,143        14,202,857
Isingiro                    3,000,000            1,000,000             600,000              593,000           1,593,000
Kaabong                       500,000            3,840,000                 -                304,000           4,144,000
Kabarole                          -          37,150,000                    -           22,000,000           59,150,000
Kaberamaido                 8,960,000            2,995,909            4,370,000             827,127           3,823,036
Kagadi                        800,000             750,000            15,000,000            1,302,500          2,052,500
Kalangala                   7,255,000            2,837,143            8,945,000            6,449,143          9,286,286
Kaliro                     62,000,650        24,617,143                    -                    -           24,617,143
Kamuli                     12,650,000            8,229,429            1,650,000            1,234,286          9,463,715
Kanungu                     4,000,000            4,700,000            1,500,000             358,500
Kapchorwa                   6,000,000            5,811,818           11,000,000            2,566,909          8,378,727
Katakwi                           -              1,963,636                 -                150,000           2,113,636
Kayunga                    10,000,000        11,824,286               2,000,000            2,736,000        14,560,286
Kiboga                      7,000,000            8,319,000            1,800,000             656,571           8,975,571
Kisoro                        108,500            1,387,500           10,200,000            7,316,500          8,704,000
Kirihura                    2,500,000            1,461,818                 -                    -             1,461,818
Kitgum                     45,992,600        28,418,057              35,876,000        17,278,000           45,696,057
Koboko                            -              1,400,000                                      -             1,400,000
Kotido                      8,000,000            2,382,500           12,000,000            2,413,500




                                                                                                                      40
Town councils        LST                                         LHT                                        Total actual
Kyenjojo                     4,000,000          2,615,000                2,500,000          1,908,800              4,523,800
Kyotera                      1,200,600         10,285,714                6,500,000          2,000,000            12,285,714
Lugazi                      38,441,585         30,980,143                3,281,500          3,998,571            34,978,714
Lukaya                       4,131,518          2,790,000                1,900,000          2,230,250
Luwero                      10,000,000          4,470,000                1,500,000          1,633,817              6,103,817
Malaba                      60,000,000         11,269,474               12,000,000          6,928,909            18,198,383
Manafwa                      9,000,000          1,898,182                     -                     -              1,898,182
Masindi                     16,000,000         13,421,990                8,000,000          9,680,500            23,102,490
Mayuge                       4,000,000          4,242,857                2,000,000          1,250,571              5,493,428
Mityana                     12,000,000         16,854,429                8,000,000          6,816,000            23,670,429
Mpigi                       10,404,500          3,394,286                7,250,000          2,751,429              6,145,715
Moyo                                            5,065,000                4,950,000          3,284,000
Mubende                     12,500,000          2,116,250                4,680,000          1,805,143              3,921,393
Nakapiripiriti               3,760,000          1,346,182                     -                     -              1,346,182
Nakasongola                 15,000,000          4,191,429                2,200,000              107,143            4,298,572
Namutumba                    4,226,000          3,573,382                     -                     -              3,573,382
Nansana                     15,000,000         16,457,143                 300,000           1,083,429            17,540,572
Nebbi                       14,000,000          9,716,000                5,400,000          6,142,000            15,858,000
Oyam                              -                 470,000                   -                     -               470,000
Pader                       20,000,000         10,753,750               41,000,000          2,413,500            13,167,250
Pallisa                     42,000,000          5,244,750                4,000,000          2,608,364              7,853,114
Rakai                                          24,245,750                     -                     -            24,245,750
Rukungiri                   25,000,000         22,366,500                5,000,000          1,940,500            24,307,000
Sembabule                    2,530,000          2,005,714                 820,000               257,143            2,262,857
Kasese                      30,000,000         30,053,992               58,500,000         27,300,000            57,353,992
Yumbe                        5,568,000                  -                2,110,000          1,835,000              1,835,000
Total                      740,217,722       519,717,661               407,861,000        184,542,341           675,966,752



                      LST                                        LHT
Municipal Councils    Budgeted             Actual                Budgeted              Actual               Total actual
Arua                          55,537,630            15,348,100           27,500,000         16,724,400            32,072,500
Entebbe MC                   119,000,000        129,611,390             136,064,000        127,389,840           257,001,230
Fortportal                    49,000,000            37,600,000           30,000,000         26,200,000            63,800,000
Gulu                          75,979,742            63,579,380           45,020,000         22,244,900            85,824,280
Jinja M.C                     64,800,000            76,304,571           32,400,000         28,800,000           105,104,571
Kabale                        54,000,000            13,341,137           18,500,000         10,181,900            23,523,037
Lira M.C                       1,000,000            12,429,274            1,200,000         12,350,182            24,779,456
Masaka                        56,805,000            34,705,000           29,000,000         23,742,300            58,447,300
Mbale M.C                     45,000,000            25,857,976           40,000,000         17,264,182            43,122,158
Mbarara M.C                   87,807,283        116,135,610              32,500,000         22,593,500           138,729,110
Moroto                        20,000,000             1,362,500            5,688,569             2,777,500           4,140,000
Soroti M.C                    15,000,000            16,537,527           12,500,000         11,498,455            28,035,982
Tororo MC                      32800000              23818769               6100000              2030727            25849496
Total                      5,009,084,922      3,616,267,676            1,409,037,420       721,155,670         4,280,836,846




                                                                                                                           41
                       LST                                   LHT
Kampala City Council   Budgeted            Actual            Budgeted            Actual               Total actual
Kawempe division             219,486,690       166,011,120          16,075,000            2,260,286        168,271,406
Central division             198,000,000       131,527,636         448,900,000       291,893,455           423,421,091
Nakawa division              278,000,000       182,923,636          86,345,000        57,127,636           240,051,272
Lubaga division              264,000,000       199,090,909          92,645,000        71,289,818           270,380,727
Makindye division            196,560,000       124,974,545          85,870,000        52,983,273           177,957,818
Total                    1,156,046,690         804,527,846         729,835,000       475,554,468         1,280,082,314




                                                                                                                     42
      Annex 4: Trend in local revenue performance (shs'000)

Source                2002/03           2003/04         2004/05            2005/06                 2006/07           2007/08

Graduated tax         51,778,875         36,526,446       60,038,704           10,865,871             4,429,273                      -

Property tax          13,552,352          6,788,407          3,525,779         26,716,387            37,817,156           28,486,603

User fees             18,430,550         13,099,763       10,504,237           23,095,924            20,945,588           64,854,246

Licenses               3,542,416          5,804,519          4,091,311         12,205,937            11,778,524           13,478,964

Others                12,266,832         17,887,507       12,200,841           27,781,041            23,684,109            9,064,925

Total                 99,571,025         80,106,642       90,360,872         100,665,160             98,654,650       115,884,738
% increase                                    -20%              13%                 11%                     -2%              17%
      Source: LGFC




      Annex 5: Performance of LGs in the national assessment 2008
      LG level                  Total                                              Performance
                                Of LGs          Minimum conditions                  Combined                   No            %age
                                                                                  Overall Status
      Districts                    80       Met                            Reward                                   16              20
                                            Met                            Static                                    8              10
                                            Met                            Penalty                                   2               4
                                            Not Met                        Penalty                                  54              66

      Municipals and City          18       Met                            Reward                                    5              28
      Divisions                             Met                            Static                                    1               6
                                            Met                            Penalty                                   1               6
                                            Not Met                        Penalty                                  11              61

      Municipal Divisions          37       Met                            Reward                                    5              14
                                            Met                            Static                                    3               8
                                            Met                            Penalty                                   1               3
                                            Not Met                        Penalty                                  28              76

      District LLGs                964       Met                           Reward                                    86             8
                                             Met                           Static                                    30             4
                                             Met                           Penalty                                   11             1
                                             Not Met                       Penalty                                  832            86
                                District LLGs Not Assessed                                                            6           ***
                                6 LLGs were not subjected to overall performance: Nyahuka TC of Bundibugyo DC, Dokilo TC of Dokolo DC,
                                Bugemeb Tc and Kakira TC of Jinja, Mpondwe/Lhubilika TC of Kasese DC and Lwakhaka of Manafwa DC




                                                                                                                           43
Annex 6: Status of implementation of JARD 2008 undertakings



     Thematic area                           Undertaking                                 Responsibility Centre                Progress/ status on Implementation
1   Local Economic     Print and disseminate LED Policy and Strategy                MoLG (LCD)                     A draft policy and strategy in place and due for discussion
    Development                                                                                                    by the stakeholders.
                       Conduct local economy assessment in at least one LG per      MoLG (LCD)                     MoLG has contracted a firm to carry out Local Economic
                       district across country                                                                     and Business Assessment in 15districts and 6 municipal
                                                                                                                   councils.
                       Review the Harmonised Participatory Planning Guide           MoLG (PPD)                     Still awaiting the local economic assessment and the LED
                       (HPPG) to incorporate LED modality                                                          policy to be completed.

2   Service Delivery   Support 10 TCs to implement their physical structure plan.   MoLG (UA),                     TCs are submitting progress reports on implementation of
                                                                                                                   their structural plans out of which 10 TCs will be selected for
                                                                                                                   support. Funds will be transferred to the respective TCs in
                                                                                                                   the 2nd quarter 2009/10
                       Conduct a nation-wide dissemination of the National Land     MLHUD,                          MoLHUD shelved this undertaking because of the
                       Use Policy                                                                                  unavailable information required before it can proceed. A bill
                                                                                                                   on this is before parliament. A policy is also required
                       The minimum service standards for service delivery should    All Line Ministries and MoLG   Minimum service standards for ministries of Education,
                       be finalised and disseminated jointly between MoLG and       (LAI)                          Water, Roads, Production and Gender were finalised. The
                       the service line ministries                                                                 ones of ministries of Health and Environment to be finalised
                                                                                                                   by a consultant in fy 2009/10.


3                      The Minimum standards of service delivery should inform      All Line Ministries and LGs    Its in the approved work plan and to be finalized 2009/10.
                       the client charters developed by LGs




                                                                                                                                                                                     44
4   Monitoring &       Review functionality of the Decentralisation Technical       DTWG & MoLG           The Technical Working Groups have been constituted and
    Evaluation         Working Group (DTWG) to ensure it is fully integrated into                         they are operational and have actively participated in
                       MoLG management systems as required by national                                    planning process of the financial year 2009/10 LGSIP work
                       budget and planning processes. It was recommended that                             plan.
                       the DTWG meets quarterly and be further supported by
                       the establishement of Technical Working groups.
                       The LGSIP should be reviewed to confirm the baseline         DTWG & MoLG (LGSIP    Evaluation of technical proposals submitted was completed.
                       data, remove obsolete indicators and include new             Secretariat)          Awaiting a go ahead from the contracts committee to
                       indicators.                                                                        evaluate financial proposal.
5   Fiscal             MoLG, MoFPED, URA, LGFC and LG Associations should           MoLG, LGFC            Matters with Solicitor General to give legal guidance on the
    Decentralisation   agree on the modality for collection and payment of                                matter.
                       agency fees
                       MoLG should develop and disseminate the LST guidelines       MoLG (LAI)            The general guidelines were finalised to be disseminated
                       for commercial farmers                                                             under LGSIP 2009/10. Statutory Instrument for regulations
                                                                                                          awaiting approval by cabinet and Solicitor General.

6   Political          MoLG should develop guidelines with quantifiable             MoLG (LCD, DA & UA)   Draft TORs were finalised for a complete study in Uganda.
    Decentralisation   indicators to guide the creation of new LGs and                                    The concept note in place. Awaiting clearance from top
                       Administrative Units                                                               management for the assignment to go ahead.




                                                                                                                                                                         45
Annex 7: Status of implementation of JARD 2008 recommendations



Thematic area                                 Recommendation                                   Responsibility   Progress/ status on Implementation
                                                                                                  Centre

Administrative   i) Operationalise Result Oriented Management (ROM) through periodic          ALL CAOs, TCs     Communication was made to LGs. To get updates from the District JARD
Issues           performance reviews.                                                                           consultation reports.
                 ii) LGs should strictly adhere to work plans as resource framework and       ALL CAOs, TCs     to get updates from LGs.
                 monitoring instrument

                 iii) MoLG should consider cascading council orientation to parish and        MoLG, HLGs        Communication was made to LGs. To get updates from JARD reports.
                 village levels and provide continuous support to the councils on roles and
                 obligations.
                 iv) Government should introduce innovative periodic performance review       MPS,MFPED,MoL     MoES and LGs are doing it for Head Teachers. Lessons learnt will be used in
                 mechanisms such as performance contracts.                                    G                 other sectors and cadres.

                 v) All stakeholders operating in the LGs should always provide reports       CAOs & TCs        Communication was made to LGs and to get updates from District JARD
                 and programme documents to enable LGs to coordinate and monitor                                consultation reports.
                 them.
                 vi) Fill vacant posts of Parish Chiefs in all LGs                            MoLG, DLGs,       At the end of Aug, 2009, filled posts of Parish Chiefs were 3692, while 1,981
                                                                                              DSCs              vacant (65.1% filled).
Physical         i)  MoLG and MLHUD should adopt a metropolitan planning and                  MoLG (UA),        Kampala Capital City Bill was passed by cabinet and is now in Parliament for
Planning         management modality for greater Kampala.                                     MLHUD             approval.
                 ii) A dedicated fund for capacity building support for professional urban    MoLG (UA), CBU    Taken care of under the CB component under the LGMSDP.
                 planning and management should be established.

                 iii) A special allocation formula of resources for urban local government    MoLG, LGFC        The ratio was reviewed to 45%,40% and 15% for poverty count, population and
                 should be developed to take into consideration day populations and the                         area respectively. Per capita income for Urban and Rural was reviewed to $2
                 cost of urban services.                                                                        and $1.6 respectively.
                 iv) All Districts and Urban Councils should recruit a physical planner to    CAOs & TCs        To be updated from JARD reports
                 perform physical planning function



                                                                                                                                                                                      46
                 v) MLHUD in partnership with other stakeholders should set up a special   MLHUD,MoFPED,     MoLHUD is working with City Alliance to come up with the slum development
                 grant for slum redevelopment.                                             MoLG              programme for Jinja, Mbale, Kabale and Arua Municipal Councils. MoLHUD is
                                                                                                             developing Housing and slum development strategies.
                 vi) All the remaining 46 districts should establish Town Boards to        MoLG (UA), DLGs   53 districts have established Town Boards and some of the remaining 26
                 facilitate guided urbanization.                                                             districts have submitted requests to MoLG to establish TBs. Technical
                                                                                                             studies are underway to establish their viability.
                 vii) The Land Act should be reviewed to enable Urban Authorities to       MLHUD, MoLG       The Bill was developed and is still in Parliament
                 effectively manage urban development.

                 viii) Physical planning should be undertaken for all the Town Councils    MLHUD, MoLG       MoLG will support only 10 Town Councils in 2009/2010 because of limited
                 and Town Boards                                                                             resources.

                 ix) The review of the Town and Country Planning Act should be             MLHUD             The Bill was developed and is still in Parliament
                 undertaken by next JARD.

                 x) MLHUD and MoLG should expedite formulation of the National Urban       MLHUD, MoLG       The project is on-going and the Steering Committee was inagurated.
                 Policy and Strategic Urban Development Plan should be formulated by
                 the next JARD.
Service          i) LGs should prepare and regularly update assets registers for all       CAOs              Communication was made to LGs, to get updates from LG JARD reports.
Delivery         properties owned by them.

                 ii) MoLG in liaison with other LMs should support LGs to carry out site   MoLG
                 mapping activities for projects and other key services.
                 iii) Local Governments should enact by-laws to enforce provision of       CAOs & TCs        ULGA disseminated a manaul on how to develop bye laws.
                 various critical services such as sanitation.

Monitoring and   i)    MoLG should organise and coordinate integrated inspection,          MoLG              Consultations have been made in view of developing a year planner
Evaluation       monitoring and evaluation visits                                                            harmonizing all inspection and monitoring activies.

                 ii) MoLG and the LGs should provide funding for M&E Systems and           MoLG              Every programme provides for M&E
                 ensure that M & E is one of the core functions of LGs

                 iii) Systems such as (IFMS, LoGICS) should be rolled out to all the LGs   MoLG(PPD)-
                                                                                           LoGICS , LAI -
                                                                                           IFMS & MFPED-




                                                                                                                                                                                  47
                                                                                              IFMS


                  iv) LGs should monitor their expenditures to ascertain consistency with     CAOs & TCs
                  overall PEAP and subsequently the NDP.
                  v) In partnership with the Public Service Sector Management Working         OPM/PSWG
                  Group (PSMWG) , the Decentralisation Sector Working Group will
                  underttake to support the development of coordinated frameworks for
                  Inspection, Monitoring, Evaluation and Support Supervision to be
                  implemented by MoLG, Line Ministries and other stakeholders should
                  ensure effective and efficient service delivery. This coordination
                  framework should commence with the National Budget Process 2009/10

Good              i) LGs should promote public awareness through the media and dialogues      CAOs                 Being done especially through News papers and Local FMs.
governance

                  ii) A multi-sectoral induction of key accountability institutions such as   MoLG, Dept. of       Have had training for TCs of MCs and CAOs. Arrangements are underway to
                  RDCs, MPs, IGG, District Chairpersons and Municipal Mayors should be        Ethics & Integrity   organise training for RDCs, MPs, IGG, District Chairpersons and Municipal
                  conducted.                                                                                       Mayors.
                  iii) Develop and Implement a Civil Education Strategy for increased civil   MoLG, (LCD)          Good Governance and Anti Corruption strategy in place.
                  competence on rights and obligation and to strengthen anti-corruption
                  institutions.
Fiscal            i) MoLG, LGFC & CMA should identify and support selected LGs to pilot       MoLG(LAI), LGFC,     Discussions are ongoing between LGFC staff, Economic Policy Research
Decentralisatio   Municipal Bonds. The criterion for Pilot LGs should be based on good        CMA                  Center and BOU staff on the best way forward in implementing Municipal
n                 governance, infrastructure needs, credit rating, credibility, prudent                            Bonds.
                  financial management.
                  ii) MoFPED and MoLG should conduct a feasibility analysis of reviving       MoFPED,
                  the Local Authorities Loans Fund.                                           MoLG(LAI)
                  iii) Document and disseminate best practices on LST/HT.                     MoLG(LAI), LGFC      Documenting best practices
                  iv) The Ministry responsible for Trade should have a new legislation that   MTTI, MoLG (LAI)     Business Levy Bill has been developed.
                  separates licensing and levying of business in LGs.




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