Devolution provides a ray of hope for the people of Hwange, Matabeleland North Province with the highest prevalence of poverty in Zimbabwe.
Hwange residents expressed interest on public finance management (PFM) in the context of devolution in the country at the recently held PFM Reform Indaba in Hwange convened by the Zimbabwe Coalition on Debt and Development (ZIMCODD) on the 7th of May 2019.
The major question was: How will Hwange benefit from its natural resources as the country commit to devolution spelt out in Chapter 14 of the Constitution of Zimbabwe Amendment 20 of 2013? The question is very relevant considering that Matabeleland hosts the largest coal deposits in the country, Hwange National Park and the mighty Victoria Falls, the two of which are world renowned tourist destinations with the latter being of the Seven Wonders of the World.
The deliberate decision to cede or transfer power from central government to provincial councils and local authorities is a noble idea. The criteria proposed under the 2019 National Budget Statement based on population size, poverty levels, infrastructure deficits and economic disparities between provinces is a good starting point.
However, a comprehensive revenue sharing model should not only be influenced by political parameters. The financial and economic considerations have to be made in determining the weight of population, infrastructure gaps and/or economic disparities in setting the fiscal formulae for revenue sharing in which case, the different provincial and local councils will be funded commensurate to their fiscal needs, effort and gaps.
Nevertheless, devolution is not a panacea to inequality, poverty and poor corporate governance if it does not bring about empowerment, participation and inclusion by the governed. Moreover, the success of devolution depends on sound PFM systems at both central and local levels.
The Indaba was therefore clear on strengthening legal and institutional provisions enhancing efficiency and effectiveness in public service delivery and allocation of resources amid outright corruption and misappropriation of state funds by local authorities. PFM principles, therefore guarantee integrity in financial and non financial reporting, control, budgeting &performance systems.
The success of devolution in Zimbabwe, therefore lies in the ability to plan and implement, consistent with Section 301 of the National Constitution, on allocation of revenues between provincial and local tiers of government and related frameworks for public finance management hinged on the following;
· Expenditure management;
· Financial accountability mechanisms and frameworks;
· Respect of statutory limits on state borrowing;
· Internal control mechanisms;
· Reporting requirements of the Auditor General and Parliament of Zimbabwe in their joint oversight roles.
Towards effective local governance…
ZIMCODD therefore calls for political will to address weak internal controls, poor corporate governance, procurement irregularities, and inadequate controls in receipting payments and meeting statutory obligations and deadlines for financial reporting which are recurrent in the successive Auditor General’s reports.
Without political will to implement punitive measures on errant local and central government officials, the inherent benefits associated with devolution will remain theoretical.
The first step therefore will be to enforce the implementation of Section 299(1) of the Constitution regarding the role of parliament to monitor and oversee provincial and metropolitan councils as well as local authorities through the alignment of the Public Finance Management Act to the Constitution and the promulgation of an Act of Parliament to operationaliSe devolution.
The proposed Act of Parliament should be clear on the obligation of sub-national governments to submit annual budgets and financial performance reports to government, Auditor General and Parliament of Zimbabwe. Such provisions should also incorporate provisions that establish institutional and administrative frameworks that are used by parliament in monitoring and overseeing state revenues and expenditure.