Internal Resource Mobilization of the Urban Local Government in Bangladesh

1.1 Background

The Pourashavas are one tiers of urban local government in Bangladesh. There is both cooperation as well as separation of activities between the urban local government and the central government in regards financial management and administration, maintenance of law and order, prevention of law and order, development of infrastructure etc.

For the reason, local governments will have to develop a history of generating an annual surplus of revenues over expenditures. So, not only must the local government manage its finances well, they must be able to present well maintained budgeting and accounting records to verify their performance. There are only three ways that a local government can reliably develop a surplus that they can commit to long term debt repayment.

They can increase their “own source revenues” as currently defined.

They can reduce their expenditures.

They can develop new sources of revenue.

In Bangladesh, the income of Pourashava depends on government grants and internal revenues. The income is not well enough to maintain all the functions. It needs to find out the income first and then expenditure of the Pourashava. The financial activities of a Pourashava may be classified as Accounting, Budgeting and auditing. Budget means the anticipated income and expenditure of a year to maintain all responsibilities in a Pourashava every year a budget has been sanctioned.

1.2 Statement of the Problem

It is identified that the problems of Pourashava finance are many and complex and the present level of understanding about the problems and prospects of Pourashava finance management and administration of a Pourashava in the country is inadequate. It is clear that in Bangladesh the Pourashava allows face the gap between income and expenditure which is the constraint for any development. As for it is essential to find out the existing income sources and expenditure pattern of the urban local government and attempt  to  minimize the gap of income and expenditure is needed to find out the potential revenue-generating sources, as for mobilizing the internal resources for better financial management of the Pourashava.

1.2.1 What is Resource Mobilization?

Resource mobilization means to increase the financial capability of the urban local government for over all development.

1.2.2 Why Resource Mobilization?

Ø  Better financial management

Ø  Proper institutional management

Ø  Social and political credibility

The process of mobilizing resources begins with the formulation of a resource mobilization strategy, which may include separate strategies for mobilizing financial and in-kind resources. Carrying out a financial resource mobilization strategy includes the following steps: identifying potential sources of funds, actively soliciting pledges, following up on pledges to obtain funds, depositing these funds, and recording the transactions and any restrictions on their use. The process is generally governed by legal agreements at various stages.

1.3 Objectives

ü  To explore the existing sources of income and items of expenditure of Nowapara Pourashava

ü  To identify the problems and prospects of Internal Resource Mobilization of the study area

1.4 Rationale

The Pourashava of Bangladesh receives the power revenue collection and obligation of providing urban public services through the Pourashava ordinance, 1977. The Pourashava of Bangladesh can generated internal resources through taxes, rates, fees and rents from own property. These are collected to defray mainly the expenses of establishment and maintenance of roads, water supply system, conservancy and electricity for lighting the roads. Government grants constitute a significant portion of Pourashava income .this study is mainly based on finance and administrative in terms of urban management. Because every Pourashava has a huge number of responsibilities. To operate all these responsibilities properly they have to depend on its income and its administration of proper management. Obviously Pourashava has an administration and finance mechanism, but it does not play in rational way.

So finding out the existing phenomenon it should develop a strategy for the financial management and administration. And find the potential revenue generating sources for Pourashava self-financing and well management. For this reason this study will be conducted.

1.5 Scope and Limitations

Resourcing is defined as “the total means available to local government to meet local developmental objectives aimed at increasing the quality of life for its citizens”. These include financial resources; Pourashava land and buildings; extensive networks with community, private and international organizations; planning instruments; knowledge of markets; business and financial management expertise; and linkages to the international donor community and finance institutions.

Now the Pourashava can influence significantly the ideal assignment of public service responsibilities and revenue generating powers among levels of government, as well as the types of reforms required to deal with existing system deficiencies. In this study also highlight some of the innovative means local government has developed to raise and efficiently utilize local, national and international resources to meet local objectives.

In the present study, the following are the limitations

ü  Limited time

ü  Money problem

ü  Detailed data are not available in a systematic manner.

1.6 Research Assumptions

ü  The site as well as the Pourashava, the services delivery systems are not well enough and the tax collection system is very poor.

ü  A gap exists between the income or revenue collection and the expenditure pattern. This gap always is negative.

ü  The Pourashava has some innovative sources and own property in which it can be developed for income generating.

ü  The immovable properties of the Pourashava are not properly utilized.