Is Decentralisation in Ghana pro-poor?

Abstract

There is a popular belief among decentralists that if local governments have the power to generate and spend revenue, without relying on central government funding, their expenditure will be pro-poor and will improve the lives of local people. Such views have influenced recent calls for greater decentralisation in developing countries in general and Africa in particular. However, evidence from Ghana casts some doubts on this view. A brief comparison of the expenditure and revenue patterns of the poorest and richest local governments there suggests that local governments are not inherently pro-poor and that locally generated funds might be used in ways that do not reflect the needs of the locality as a whole. Thus the fiscal devolution view of decentralisation appears to be out of kilter with reality. To discuss this issue, the three sections in this paper summarise the assumptions and perceived benefits of decentralisation, describe decentralisation in Ghana, and analyse the revenue and expenditure patterns of the Kumasi Metropolitan Authority and the Kasena Nankana District Assembly.