Local Government Finance in Bangladesh: A Case Study of Two Union Parishads of Fulbari Upazila

Abstract

Local Government is an administrative body for a small geographic area, such as a city, town, county, or state. A local government will typically only have control over their specific geographical region, and cannot pass or enforce laws that will affect a wider area. The legacy of the local government and local selfgovernment

system in Bangladesh prevail in different forms, Such as: administrative set up, rules and regulations, bureaucratic culture, rural power structure etc. similar to that of India and Pakistan, as this subcontinent share a common history of local governance. Since Independence in 1971, different government in different forms initiated a number of attempts to tinker with the rural and urban local government system in Bangladesh. Presently Local Government of Bangladesh is divided in to primary tier that are Rural Local Government and Urban Local Government. Union Parishad is the lowest level of Rural Local Government. Union Parishad (UP) is the local body and lowest tier of the local government that has huge potential in poverty reduction. This 140 years old institution has wide roles and responsibilities in rural development and poverty reduction empowered by the Constitution and Ordinance but partyarchy and patron-client relationship impacted largely on the governance system.

This study aims to explore the existing financial system and state of resource mobilization of Kazihal and Shibnagar Union Parishads of Dinajpur District, to identify the problems and challenges in existing financial system and to assess the institutional mechanism needed for overcoming the challenges. This study is intended to analyse the financial aspects and its problems in the local government in Bangladesh. Based on the understanding of the study, its contexts, results and the objectives of the study, it is understood that this study needs to deploy a mixed method research approach using both quantitative and qualitative research techniques to achieve the specific objectives of the mission. The data are collected concurrently or sequentially, are given a priority, and involve the integration of the data at one or more stages in the research process (Creswell, Plano-Clark, Gutmann & Hanson, 2002, p. 212). In-depth interviews and survey with semi-structured questionnaire are conducted to attain data along with the line of the major objectives and research questions of the thesis.

Finally this study argues that, as the lowest tier of local government body, UP can implement activities for identifying potential areas of resource mobilization. Local own revenues are a necessary but not a sufficient condition for to be self-reliant because there are various factors involved. UP can barely exercise financial authority that they have to mobilize their own resources because of central dominance. Consequently, they had never been financially solvent due to shortage of adequate manpower, absence of proper tax assessment, fear of losing popularity among the UP members, predominant tax evading culture, perceived weaker correlation between tax payment and service delivery, and inadequacy of sources of income.