RISE-Ghana Calls for Doubling of DACF Administrative Cap to Strengthen Local Governance

The Rural Initiatives for Self-Empowerment Ghana (RISE-Ghana) has called for a doubling of the administrative expenditure cap for Metropolitan, Municipal and District Assemblies from 5 percent to 10 percent of their District Assemblies Common Fund allocation, arguing that the current ceiling is undermining local governance and fuelling financial irregularities.

In a statement signed by Executive Director Awal Ahmed Kariama, the advocacy organisation said administrative functions critical to accountability and service delivery are being starved of resources, with consequences that reverberate through successive Auditor-General reports.

A System Under Strain

The District Assemblies Common Fund, established under Ghana’s 1992 Constitution, serves as the primary mechanism for transferring national revenue to local authorities. MMDAs are expected to deploy these funds across infrastructure, sanitation, health, education and administration. But RISE-Ghana contends that the 5 percent cap on administrative spending has created a structural weakness that makes effective oversight nearly impossible.

“The continuous capping of oversight administrative expenditure for MMDAs at 5 percent of their District Assemblies Common Fund allocation is weakening local governance systems and contributing to the recurring financial irregularities repeatedly identified by the Auditor-General,” the statement read.

The organisation cited Auditor-General reports showing that irregularities linked to the management and utilisation of the DACF exceeded GH₵452 million between 2020 and 2024. The figure rose sharply to GH₵205.9 million in 2024 alone, suggesting the problem is accelerating rather than improving.

The Cost of Inadequate Oversight

RISE-Ghana acknowledged that the bulk of DACF allocations must flow to tangible development projects. However, it argued that without adequate administrative capacity, assemblies cannot properly supervise those very projects.

Activities such as project monitoring, record management, procurement compliance, financial oversight, inspections and the implementation of audit recommendations all depend on administrative infrastructure — infrastructure that the current cap leaves chronically underfunded.

“In practice, many assemblies struggle to adequately supervise projects, maintain reliable records, conduct regular inspections and enforce accountability mechanisms,” the organisation noted.

The challenges at the local level mirror broader concerns about public service delivery. Residents of Sogakope recently took to the streets over alleged overbilling and poor service from the Electricity Company of Ghana, highlighting the frustration that builds when local institutions fail to meet expectations.

The Auditor-General’s 2024 report reinforced this concern, revealing that all 261 MMDAs audited recorded irregularities arising largely from non-compliance with laws, regulations and established internal controls. The findings point to a systemic governance challenge rather than isolated lapses.

A Call for Reform

RISE-Ghana is urging Parliament, the Ministry of Local Government, Chieftaincy and Religious Affairs, the Administrator of the District Assemblies Common Fund, development partners and civil society organisations to initiate a national discussion on reviewing the current arrangement.

The organisation specifically proposes increasing the administrative cap to at least 10 percent and excluding human resource development expenditure from the cap calculation — a distinction it argues would allow assemblies to invest in the professional capacity of their staff without competing against operational oversight needs.

According to RISE-Ghana, the proposed reforms would strengthen oversight mechanisms, improve accountability, enhance responsiveness and ensure greater value for money in the delivery of public services at the local level.

The call comes at a time when Ghana’s decentralisation agenda faces increasing scrutiny. The recurring pattern of audit irregularities across all 261 MMDAs suggests that the problem is not one of political will alone but of structural capacity — a gap that the current funding arrangement appears to perpetuate.

Whether Parliament and the relevant ministries will take up the proposal remains to be seen, but RISE-Ghana’s intervention adds to a growing body of evidence that effective local governance requires investment in the systems that make accountability possible.

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