Budgetary control and performance of local governments : a case study of Mubende Municipal Council

Abstract

The study aimed at establishing a relationship between budgetary controls and performance of Local Governments. The study objectives were; to establish the compliance levels with the legal and regulatory framework for budgeting in Mubende Municipal Council, to assess the effectiveness of financial control mechanisms in Mubende Municipal Council and to examine the effect of existing financing mechanisms on the performance of Mubende Municipal Council. The study used a descriptive case study research design where both qualitative and quantitative approaches were used in the study. The study population included; local government officials occupying both Political and technical positions, NGO staff and ordinary citizens. The study used a questionnaire, an interview guide and direct observation in data collection and data was analysed to obtain descriptive statistics in form of frequencies and percentages. From the findings, it was revealed that the compliance levels are below average because there is no value for money in most of the activities done in service delivery of the municipal council and a poor budget practice that leads to inefficient allocation of resources. Financial control mechanisms in Mubende Municipal Council are not effective since most of the respondents say service delivery is very poor in this community and there are great discrepancies between what is collected and what is actually banked. The effect of existing financing mechanisms on the performance of Mubende Municipal Council is still very weak and lack of budget monitoring implies that less is collected since there is laxity in monitoring the process to ensure that what is actually needed is actually collected in form of taxes, fees and licenses among others. There is high dependency on the central government for grants which normally delays. It was therefore concluded that compliance levels with the legal and regulatory framework for budgeting in Mubende Municipal Council are still low, financial control mechanisms in Mubende Municipal Council are not effective due to a lot of financial mismanagement, and that the council faces a challenge of political pronouncements and incorrect information in the vote book leading to poor planning and execution of activities. It was therefore recommended that there is need to enforce mechanism provided in the financial rules for supervision, hire an external audit firm to monitor the implementation of social services, introduce computerized revenue and ensuring that the release of funds to LGs is done in accordance with section 14 (2) and (3) of the PFM Regulations 2016 thus maximizing the time value for money.