In JPLG, 5 UN agencies, namely, UN-Habitat, ILO, UNDP, UNCICEF and UNCDF are working together to improve local governance of Somalia. One of the flagship projects of JPLG is the Municipal Finance in which UN-Habitat is leading. Effective and accountable local governments are crucial for stabilization, improved service delivery and economic growth.  To improve the functions of local governments with a view of an improved service delivery capacity, UN-Habitat has been supporting local governments in Somalia more than a decade, chiefly in the following areas:

Capacity Development: Municipal staff were trained on basic accounting, financial management, map reading and surveying skills. In addition, local councillors were trained on different leadership management modules including local leadership management training with a focus on decision-making policy-development, financial management and institution building.

Systems and Procedures: UN-Habitat supported the local governments in Somaliland and Puntland and henceforth revolutionized the very manner in which municipal tax is collected and managed. A Geographical Information Management System was applied to capture property characteristics in 8 districts in Somaliland and 7 districts in Puntland. The surveyed properties were incorporated into a local database that is linked to automated accounting and billing systems for improved revenue collection and management.   The automated system has improved the accountability and transparency of local government functions as all finance-related transactions are captured and reported in the system. Due to the changing demands and increased local government functions, UN-Habitat collaborated with World Bank in upgrading the existing system to an Enterprise Resource Planning Software to manage country’s public finance resources. The new Financial Management Information System (FMIS), with its upgraded features and functions, inter-linked both at the centre and sub-national structures, presents stronger and more transparent financial management practices.

Legislative Reform: With regard to legislation reform, UN-Habitat supported the development of local government finance policy to provide a guiding framework. The policy was developed in a participatory manner and later adopted as a principle guide for local government finance-related functions. Likewise, a set of procedural manuals, designed to support the implementation of the policy, was developed as well. These include local government financial management manual, internal audit charter and district audit committee manual. These manuals are all translated into Somali; and now they are used as government tools for improved financial management functions. The local government financial management manual provides step-by-step guidance of doing local government finance functions such as revenue and expenditure management, internal oversight mechanisms, reporting, procurement and asset management, to mention a few.  

“The revenue has been increasing gradually since we have been using BIMS. Before
BIMS, the municipal office didn’t have complete registration for the number of
taxpayers in Gabiley district. We didn’t have the number of businesses in the city or the
number of the houses in Gabiley but we have all this information today. ...the system
has increased efficiency of the revenue collection.”

Head of Tax Department, Gabiley District

15
districts implemented GIS-based property survey and reported 300% revenue increase in average.
15
districts are using automated financial management systems and reported improved efficiency, transparency and accountability
Unlike the old habit of using all revenue on recurrent expenditure, municipal allocation for service delivery improved, some districts using
40-50%
of their budget on service delivery

Related Sustainable Development Goals

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SDG 3 logo
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SDG 7 logo
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Donors and partners

The success of JPLG and its different components including municipal finance is largely attributed to its fruitful partnership with national government, under the leadership of the Champion Office (headed by the Vice President) and local governments. There is a strong government ownership to ensure success of local government improvement.

 

Partners
Ministry of Interior in Somaliland and Puntland
Ministry of Finance in Somaliland and Puntland
Association of Local Government Authorities in Somaliland and Puntland

Our Experts

Abdirahman Adan Mohamoud
PD/ROAF, Somalia Program
WUF 10