Role of revenue consultants in LGA

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Role of revenue consultants in local council
administration

 

By

 

Wisdom O. Dafinone
 


LOCAL councils, and by extension, state governments
are confronted with the twin spectres of inadequate
revenue (internally generated and allocations from the
Federation Account) and exponential expansion in
social services and infrastructural demands, in an era
of general economic decline and stagnation.

Local councils are faced with additional problems of
urban/environmental decay, insecurity, horde of
unemployed graduates and youths, and eroding
economic/revenue base in juxtaposition with high
recurrent revenue profile.

Therefore, the phenomenon of declining revenue
vis-a-vis increasing social expenditures had resulted
in the three tiers of government formulating diverse
Internal Revenue Generation Programmes (IRGP) with
such acronyms as Enhanced Internal Revenue Generation
Programmes (EIRGP), or "Balanced and Sustainable
Economic Recovery Programme (BSERP).

Revenue consultants are expected to provide innovative
approaches to revenue generation, facilitate the
processes of sustainable economic development, promote
proper cost accounting practices, enhance the local
councils' strategies on poverty alleviation, and
provide new perspectives on joint public/private
sector initiatives.

In several cases, the revenue consultants had remained
in the vanguard of the restructuring and rationalising
of the public sector, and redefining the role of
government in order for it to concentrate on the
essential task of governance and the provision of the
requisite legal and macro-economic frameworks, and the
enabling environment for overall business growth.

Why employ the revenue consultants

The revenue consultancy firms are often
multi-disciplinary firms with expertise, and resources
in revenue generation, financial, taxation,
management, and advisory services.

These firms or consortium bring to bear wealth of
experience, expertise, economies of scale, synergies,
and competitive advantage critical in redressing the
issue of revenue decline in both state and local
councils.

Major sources of revenue for local councils are:

Tenement rates
Public adverts
Lockup shops
Markets
Parking/towing services
Radio/television licences
Vehicle licensing/hackney, etc.


Vehicle licensing, parking, etc, fees are supposed to
be part of the local councils' functions under the
road traffic law.

These high revenue-yielding functions have either been
taken over directly by some state governments, or
indirectly through the creation of new authorities or
quasi-agencies. There is need to review the predatory
predilections of state governments for the purpose of
legality and equity.

In cases where state governments must act on behalf of
local councils, they must act "accountably," with
utmost probity and beyond reproach.

It should be emphasised that the revenue generation,
per se, will not adequately address the problems of
general revenue decline without the required
innovations, and prioritisation of government's
services and programmes to achieve greater compliance
and collection efficiencies (CE).

Therefore, management of local councils require
credible consultants that can facilitate compliance
and greater participation from stakeholders and other
key players.

The pivotal role of local council chairmen

The local council chairmen play pivotal roles in
revenue generation through their policy objectives and
public pronouncements - (PO & PP). In other words, the
articulated agenda - PO or PP - as stated above, must
be in consonance with the revenue generation
objectives of the local councils.

The imperative of establishing priorities/perspectives


Political/economic/social programmes.

Fiscal responsibilities.

Identifying stakeholders' requirements.
Security implications for businesses and economic
growth of local councils

Undoubtedly, security plays a crucial role in the
revenue generation equation/computation. When
insecurity becomes predominant and perennial, as in
the case of some local councils, the local council
management must institute major security programmes to
restore stakeholders' confidence, and investors'
interests.

If not adequately addressed, the major stakeholders
will begin to relocate to other areas. The local
councils must constantly and continually evolve
effective strategies for capturing revenue generally.

Modalities


Deployment of security operatives and establishment of
patrol units in major streets.

instituting and implementing costs sharing formula
among stakeholders for projects.

Monitoring is a critical element of any successful
security project.
Youth unemployment and the phenomenon of urban
miscreants-area boys

Local council administration must evolve policies and
programmes on the following issues.

Definition of rehabilitation strategies and programmes
for the youths pejoratively called miscreants or area
boys, which has become a subterfuge for non
implementation of creative work and training programme
for many young people in our cities today. The local
council must engage the public in the assessment and
scrutiny of its programme for specific job creation
opportunities for youths in the local council area.

Urban renewal programmes

Local councils must initiate programmes and establish
PILOT projects and sites which would provide
opportunities for gifted indigenes in diverse areas
such as arts, which should include murals for
beautifying prominent public spaces such as bridges,
etc.

Special farming and occupational schemes should be
instituted in outlying areas of the local council to
promote youth employment.

The role of non-governmental organisations (NGOS)

Local councils must solicit the participation of
influential and relevant NGOs in providing support for
urban renewal and area boys' rehabilitation.

Create own and partner with local and international
NGOs.

Environment beautification/horticultural organisations

Define requirements for participation and achieving
local council objectives.

Collection of fees and charges arising from
infringement of environment act

Establish business relationship with appropriate
government agencies in waste management, and other
relevant utility companies.

Provide credible service for waste disposal in the
city centres.

Register and establish environmental targets for PSP
operators.

Social responsibility programmes and initiatives


Identify stakeholders/participants and establish
realistic criteria on social responsibility programmes
and initiatives;

create working committees for programme execution,
among stakeholders, etc and

establish selection process/priorities for approved
initiatives.
Local councils must continually review the status quo,
in order to establish appropriate benchmarks for
future revenue collections, and performance criteria
for revenue consultants.

It must seek to verify the authenticity of the
available data in the property status report book, in
respect of tenement rates, revenue returns data,
financial reports, etc. It should establish review
panels on revenue monitoring on a regular basis.

Banks and revenue generation

Banks, like other providers of services to the local
councils require monitoring for compliance with
approved revenue guidelines and targets.

There is the need to evolve strategies for monitoring,
and to design a schedule or "regime" of sanctions.

For the purposes of transparency and accountancy, it
is advisable for local council to align the selected
collection banks with revenue consultants, and to
establish "revenue returns" guidelines derived from
the collection banks' revenue receipts, in order to
formulate acceptable agreement for realistic revenue
(targets) returns (RRR) to the local council.

The local councils should utilise the "consortium
approach" (Banks/Companies/Consultants) for cost
efficiencies, and consensus building on project
execution.

In summation, we would like to state that this medium
can only allow a synopsis of both the problems and the
solutions on enhanced revenue generation programmes
rather than an all-embracing submission, and to evoke
a compelling and comprehensive approach to revenue
generation by the local council and its agents.

 

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Dafinone is Group Consultant, W.O.D Consultancy
Consortium Limited; financial and revenue consultants,
state and local governments.`

 

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