Internally Generated Revenues (IGR) And sustainable Local Government System

Internally Generated Revenue (IGR) And  sustainable Local Government System In Enugu State: A Study Of Ezeagu Local Government Area Of Enugu State   

CHAPTER ONE

INTRODUCTION

  • BACKGROUND TO THE STUDY

The local government is recognized by the 1999 constitution of the Federal Republic of Nigeria as the third tier of government within the tripartite federal structure of governance in Nigeria, with the state and federal government as the super-ordinate government. This government in Nigeria which exist at tripartite arrangement (Federal, State and Local Government) play commentary roles to

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Local Government is seen as a public sector organization, the third tier government with assigned functions and responsibilities, administrative structure and financial management both for maintaining itself and rendering it’s statutory assigned function to it’s citizens (Uguru, 2011). Local government authorities as a third tier of government in Nigeria are very important in the execution of both central and component government policies and programmes. It is the nearest government that deals with the problems of the masses of the country.

It is a great link between states and federal government, hence Okoli (2000) stated thus; that you cannot talk of a local government, without talking about the super ordinate government. That is, the discussion of a local government implies the existence of a higher level of government.

That local government implements the ideals, objectives, programme and aspirations of the national government at the local level.

That local government exists to fill a gap which the national government is too remote to fill. This means that local government complements and extends the national government. By this, it brings the national government closer to the people and make its impact felt at the nooks and crannies of the society.

For Okpata (2014) the ideals of the local government system are realized only when infrastructural facilities, included such tangible structure vital for the uplifting of their economic status, actualization of their life dreams and enabling them prepare for their future. They therefore constitute the indices of social development. Though their provision is capital intensive, hence reliance is heavy on the government for availability. The creation and recognition of local government system as the third tier of government is a landmark development in the political history of the Nigerian nation. As the government closet to the grassroots, the local government authorities have the official mandate to oversee.

General sanitation

Sewage disposal

Rural health

Feeder roads

Market stalls

Public conveniences

Motor parks

Play grounds

Cottage industries etc (Agundu, 2001)

Talabose (1993) cited in Uguru (2011) defined local government as a third tier of government created for the purpose of effective administration of the localities. It is in line with the enormous responsibilities bequeathed to the local to the local government that Ekpo (1994) opined that most government all over the world strive to balance their economic development in such a way that will ensure even and meaningful co-existence survival and development of her people.

It is therefore the belief of this study that it is expected that will the seven hundred and seventy – four (774) local governments in Nigeria that development will be extended to the very remote areas of the country. it is also believed that since the local inhabitants know that they desire, they elect their representatives who they believe known the problems they are facing in their local government areas.

  • STATEMENT OF THE PROBLEMS
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It is not disputable that the revenue generation in Nigeria local government is far below expectation. It has become imperative to diversity areas of revenue generation especially with the dwindling federation allocation which has been the major sources of revenue to the local government. Since inadequate revenue remains one of the devastating challenges hindering effective local government administration in the country. It then necessitated the general outing by the administrators (chairman) of local government for a change in revenue formula which is the only major source to income the percentage of the share for the local government. This problem of poor revenue base has almost led to the collapse of most grass root government.

Again, the problem of seeing local government as a mere appendage to the state and federal government financially has beclouded the patriotic and entrepreneurship psyches of local government administrators, hence most local government titled financially to the federal government for monthly statutory allocation from the federal account. This problem of economic and financial over – dependence of the local government in Nigeria is devastating, uncalled for and against the motives for the creation of local government as the third tier.

Furthermore, the inability of the local administrators to use in sourcing techniques for funds to finance the council through internally generated revenue is a thorn in the flesh of meeting up their constitutional responsibilities such as the provision and maintenance of social services (education and health care) payment of the worker’s salary and so have given rise to weather to scrap or restructure local government systems in Nigeria.

  • RESEARCH QUESTIONS

In the course of this research, the following research questions were generated for analysis.

  1. To what extent does the local government put in place structures and strategies to generate revenue internally?
  2. To what extent does the local government exploit local resources to generate enough revenue?
  3. To what extent has Ezeagu local government been sustained by Internally Generated Revenue?
    • PURPOSE OF THE STUDY

The main purpose of the study is to identify strategies for accelerated internally generated revenue for community development, while the specific purpose include;

  1. To explore areas and methods of revenue generation in the local government.
  2. To ascertain the level of exploitation of the sources of internally generated revenue of the local government.
  3. To find out how IGR sustains the Ezeagu Local Government.
    • SIGNIFICANCE OF THE STUDY

In all aspect this research wok will be relevant to the member of the Ezeagu Local Government Area.

It will also be beneficial to other public sector organization in Nigeria. Also it will be of vital importance to government, academically potential and future researcher on the issue of IGR and sustainable local government system.

This empirical is also germance to the researcher since it is a partial requirements for the award of National Diploma in Public Administration Department

  • SCOPE OF THE STUDY

The scope of the study covers Internally Generated Revenue (IGR) and sustainable Local Government System in Enugu State (A study of Ezeagu Local Government Area of Enugu State

  • LIMITATIONS OF THE STUDY

The first limitation which was obvious is the dearth of statistical data, another problem the researcher encountered is the time constraint. A research of this nature needs relatively longtime during which information for accurate infirmness could be drawn.

Lastly the cost, the researcher would have extended the survey to other stets and this would produced accurate and more comprehensive work but for the high cost of transportation and accommodation in the various states of the federation, it is not possible.

  • DEFINITION OF TERMS
  1. Revenue: Revenue is the amount of money that a company actually receives during a specific period, including discounts and deductions for returned merchandise.
  2. Local Government: Local government is a form of public administration which, in a majority of contexts, exists as the lowest tier of administration within a given state.
  3. Development: The process in which someone or something grows or changes and becomes more advanced.
    • ORGANIZATION OF THE STUDY
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The study was organized into five chapters. Chapter one introduced the study by giving the background information on the research problem, objectives, the scope and limitation of the study. Chapter two deals with the review of relevant literature and the theoretical framework of internally generated revenue and sustainability in the local government system. Chapter four presented the data. Chapter five presented the conclusion drawn from the research funding and recommendations.

CHAPTER TWO

LITERATURE REVIEW AND THEORETICAL FRAMEWORK

2.1           LITERATURE REVIEW

                The evolution of local government in Nigeria has under gone alots of changes. These are all geared towards making the local government a system that could serve the purpose for which they are created, before the emergence of the British Colonial/ Administration; various communities in Nigeria were governed through the instrumentality of their traditional political institutions, these institutions were anchored on the people’s habits of thought, restige and custom which are adapted to meet the new conditions for general development of their areas.

Local authorities were empowered to charge and collect development rates based on a certain percentage of the income of the rate payers. The councils enjoyed the social autonomy of providing certain social services to the community, for instance the local government was vested with the responsibility of healthcare services delivery with the transfer of primary healthcare delivery system.

In the 1950s, election was introduced according to the British Model in the western and eastern parts of the country with some measure of autonomy in financial, general administration and in personal which give rise to tide of progress, growth and development experienced in the local government.

Prior to this period, the British introduced native courts chaired by chiefs, native treasuries where taxes collected from people were paid in for use by the local government. Native authorities were created with traditional rulers, at the head of each authority. The traditional rulers continued to dominate local government’s administration until the military took over power. In 1966, from then the powers of the traditional rulers, especially in the northern region, reduced gradually. The newly created states in the Northern region increased popular participation in local government administration. Larger local authorities were broken to smaller ones and native authorities were changed to local government.

The local government reforms of 1976 provided the guidelines for local government in Nigeria. The reform created large-sized local government areas throughout the federation based on a certain minimum population requirements, these results in uniform local government areas. The federal government for the first time was involved in the funding of local governments. The local government gets statutory percentages share of federation accounts and state revenue. The local government was made a third tier of government, which means the local government has its own powers. There were about 301 local government councils as at 1976.

In 1986, the Babangida Administration made local government an effective third tier of federal system, introduced reforms aimed at enhancing their autonomy and strengthening their administrative framework. All elected councilors now constitute legislative arm of the local government which the executive arm consists of the chairman and vice-chairman and supervisory councils.

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The local government witnessed several reforms between 1991 to 1992. The reform snows a fundamental implication for local government administration, especially in regard to the reforms to the local government service. 589 local government areas were in existence as of 1991 local government reforms and there were establishment of the executive chairmanship of local government with functions firmly entrenched in schedule four of the constitution.

The federal government established the local government service commission aimed at preserving the independence of the local government staff. The federal government increased the local government share of the federation accounts to twenty percent. This increase in revenue base gave local government high degree of confidence and power to equip them for the challenging role, facing them.

According to 1999 constitution of Nigeria, not only recognizes, but also guarantees the existence of a more powerful and independent local government area section 162 of the 1999 constitution guarantees the right of the local government to revenue statutory allocation of the revenue from both the account and state resource. The forth, schedule of the same constitution spells out the functions of the local government.

The federal government increased the local government share of the federation accounts to twenty-five percent. In the present local government administration, there are about 774 local government areas in Nigeria with the rights and power of providing certain social services to the communities, such social services like provision of healthcare centers, electrification, provision of pipe bore water and accessible roads etc.

In a study by Onwe, (2009) “local government financial autonomy and Service Delivery in Nigeria”. It revealed that the manpower capacity of the local government composition of the staff of the local government will not yield the desired result. And that there is also a skill gap among the few senior staff of the local government. Dearth of professionals like certified accountants, surveyors, doctors, pharmacists, engineers, I.C.T experts etc. The competence level of the local government staff is generally poor as over sixty seven percent (67%) of the studied population agreed that the workforce capacity for harnessing the internal revenue of local government lacks the capacity desired. The study therefore recommends that there should be serious co-relation between manpower capacity and the internal revenue generation of local government.

Internally Generated Revenue (Igr) And  sustainable Local Government System In Enugu State: A Study Of Ezeagu Local Government Area Of Enugu State

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