Analysis of the relationship between revenue collection and service delivery in local governments. Case study of Lira district local government
Abstract
This study scrutinized the intricate relationship between revenue collection and service delivery within Lira District Local Government, aiming to address pressing challenges and propose tangible solutions. Objectives encompassed analysing revenue collection hurdles, identifying strategies for service delivery improvement, and quantifying the connection between revenue and services. A mixed-methods approach, combining descriptive and exploratory research designs, involved data gathering through questionnaires, interviews, and observations, both qualitative and quantitative. With a sample of 80 respondents from Lira District Local Government, raw data underwent meticulous scrutiny, editing, coding, and descriptive statistical analysis. The study revealed a significant issue of inadequate local revenue collection in Lira District Local Government. Factors contributing to this included aggressive tax collector behaviour, high administrative costs, corruption, limited revenue sources, political interference favouring campaign supporters, and lax enforcement of revenue collection regulations. Despite challenges inherent in local government structures, the study emphasized their potential for control and mitigation. Policy interventions such as motivating tax authorities and curbing political interference emerged as viable remedies. A noteworthy finding was a positive relationship between local revenue collection and service delivery, evident in a Pearson Correlation Coefficient value of (r =0.57). This underscored the importance of revenue generation for improving service provision.
The study concluded that while a significant portion of local revenue was allocated to service delivery, a worrisome percentage faced misuse by administrators involved in revenue planning. Strong measures were imperative to curtail this misallocation and it included reducing the rising issue of tax defaulters, the study recommended outsourcing revenue collection through tenders to individuals or companies on behalf of Lira District Local Government, vigorous enforcement teams should monitor and penalize non-compliant businesses, promoting tax compliance and revenue growth.
In conclusion, this research offered valuable insights into Lira District Local Government's governance landscape, providing a foundation for informed policy decisions and further studies in this vital area.