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Business News of Friday, 15 February 2008

Source: GNA

Proposed Municipal Finance Authority in November

Agona Swedru, Feb. 15, GNA - The proposed Municipal Finance Authority (MFA) would become operational in November this year to enhance municipal finance and management if passed into law in June, Prof. George Gyan-Barfour, Deputy Minister of Finance and Economic Planning has said. He said the proposed authority and Local Government Finance Bill would provide comprehensive laws to guide Metropolitan, Municipal and District Assemblies (MMDAs) in raising private capital and other resources.

Prof. Gyan-Barfour announced this at workshop for Parliamentarians, Economists and Development Partners at Agona Swedru. He said the measure would empower them to move away from the over-reliance on central government transfers to undertake productive infrastructural development and provide appropriate services efficiently. The Deputy Minister noted that the passage of the bills into law would complement the Municipal finance and Management Initiative (MFMI) to help develop investor confidence and comfort in MMDAs. He said the laws would facilitate investment in municipal bonds and credits, pension funds, and credit enhancement assistance, credit assessment and rating systems.

The Deputy Minister said the government would support the establishment and operation of the MFA for the first three years for it to become self-sustainable.

Mr. Maxwell Kofi Jumah, Deputy Minister of Local Government Rural Development and Environment said government had persistently created the enabling environment by formulating the main statutes governing local level investment funding activities. He stated that the population growth rate of four percent in the urban areas, massive funding for infrastructure developments is needed in the districts.

The Deputy Minister noted that with the increasing demands on central government's scarce resources it had become necessary for local governments to raise funding development and service delivery. He stated that the main aim of the MFMI was to assist to achieve a significant increase in internal generated funds. Mr. Kwame Pianim, an Economic Consultant, who chaired the function, advocated that the positions of Metropolitan, Municipal and District Chief Executives should be elected ones.