The Local Government Finance Commission has asked Parliament to enact a specific law that will regulate the financing of local governments with respect to adequacy, management and accountability of the decentralised services.
Handing over the annual performance report to the Speaker of Parliament Rebecca Alitwala Kadaga, the commission said it was concerned that there was a decline in the resources allocated to local governments.
The commission however noted that local governments have continued to register improvement in revenue performance in the last three financial years from Shs 177.2 billion to Shs 196 billion.
The report indicated that municipal councils had the highest improvement in revenue collection compared to the different district local government councils.
The municipal councils of Jinja, Mbarara and Gulu registered the highest percentage of local revenue collection of Shs 10.2bn, Shs 5.4bn and Shs 3.7bn respectively.
But the commission chairperson, Dr Agnes Atim asked Parliament to enact a specific law that will regulate the financing of local governments.
She said there is a need to establish a fully flagged department of local revenue that will be mandated with the responsibility of collecting and managing of all revenues collected by the local governments.
Kadaga said an additional committee will be set up in the 11th Parliament to handle the increasing issues in local governments.