Underfunding Local Governments is a Major Driver of Poor Service Delivery
By Tsebeni Ivan Rongo
Uganda’s decentralisation policy was designed to bring services closer to the people. Districts, cities, municipalities and sub-counties were expected to identify local priorities and respond quickly to the needs of their communities.
Yet, more than three decades after decentralisation became a cornerstone of governance, citizens across the country continue to grapple with dilapidated roads, understaffed health facilities, overcrowded classrooms and limited access to clean water.
Local governments remain the frontline institutions responsible for delivering essential services. However, the resources allocated to them have failed to match the increasing demands of a growing population and the expansion in the number of administrative units.
The funding gap is evident. According to discussions in Parliament on local government financing, local governments once received approximately 15 percent of the national budget, but this share has declined to around seven percent in recent years.
Members of Parliament have warned that the reduction in funding is undermining effective service delivery at the grassroots. The decline has left districts struggling to maintain existing infrastructure, let alone invest in new projects.
The consequences of inadequate financing are visible in communities across Uganda. Health centres lack medicines and sufficient personnel.
Schools operate without adequate classrooms and teaching materials. Community access roads remain impassable, particularly during rainy seasons, affecting agricultural production and market access. Water projects stall midway because of limited operational budgets.
The challenge is compounded by the fact that many local governments depend heavily on conditional grants from the central government.
While these grants are important, they often leave little room for local authorities to address unique community priorities. In addition, local revenue sources have steadily diminished following policy decisions that abolished or reduced some forms of local taxation.
At the same time, the remuneration of local government leaders continues to raise questions about whether compensation aligns with the magnitude of their responsibilities.
Reports indicate that LC5 chairpersons earn approximately Shs2 million per month, while sub-county chairpersons receive around Shs400,000. Parish and village chairpersons receive modest facilitation allowances that have often been criticised as inadequate.
The disparities in pay and the generally low remuneration for many local leaders can affect morale and motivation in a system already constrained by limited resources.
Nevertheless, it would be unfair to suggest that no effort has been made to strengthen local governments. President Yoweri Museveni has repeatedly acknowledged the importance of local structures in driving development and improving livelihoods.
Under his leadership, programmes such as the Parish Development Model (PDM) have sought to channel resources closer to communities with the aim of transforming household incomes and reducing poverty.
The Uganda Intergovernmental Fiscal Transfers Programme has also been implemented to improve equity and efficiency in the allocation of resources to local governments.
Through this initiative, investments have been directed towards education, health, water and infrastructure projects at district and municipal levels.
The President has further emphasised accountability among local leaders, urging them to ensure that public funds reach intended beneficiaries.
However, while these interventions are commendable, they cannot substitute for a broader and more sustainable financing framework for local governments. A district cannot effectively supervise schools, maintain roads and monitor health facilities without adequate recurrent and development funding. Good intentions must be matched with sufficient financial commitments.
The growing number of districts has also placed additional pressure on the national resource envelope. Every new administrative unit requires staffing, office infrastructure and operational budgets. Unless government undertakes a deliberate assessment of the sustainability of this expansion, scarce resources will continue to be spread too thinly.
There is therefore an urgent need to rethink local government financing. First, government should progressively increase the share of the national budget allocated to local governments. Restoring allocations to levels that reflect the original spirit of decentralisation would significantly improve service delivery outcomes.
Second, local governments should be empowered to enhance their own-source revenues within a transparent and accountable framework. Strengthening local revenue administration can reduce overdependence on central transfers.
Third, greater emphasis should be placed on value for money. Increased funding must go hand in hand with stronger accountability mechanisms to minimise wastage and corruption. Citizens deserve assurance that every shilling allocated to local governments translates into tangible improvements in their daily lives.
Ultimately, service delivery is the yardstick by which citizens judge the effectiveness of government. When a mother cannot access quality healthcare, when a pupil studies under a tree, or when farmers cannot transport produce because of poor roads, the promise of decentralisation remains unfulfilled.
If Uganda is serious about achieving inclusive development and improving the quality of life for its citizens, local governments must be adequately funded. They cannot continue to carry the heavy responsibility of service delivery while operating on shoestring budgets. Investing in local governments is not merely an administrative necessity; it is an investment in the wellbeing and prosperity of all Ugandans.
A major reason for this persistent challenge is the chronic underfunding of local governments.
The writer is a young politician aged 30 years, representing Bupoto Sub-county in the Namisindwa District Council.
