Deepening Representative Democracy through Fiscal Decentralisation: Is Ghana Ready for Composite Budgeting?

Abstract

The ideas behind composite budgeting for effective fiscal decentralisation are noble, but the implementation is constrained by organisational, coordination, structural and technical factors. The key unanswered question is whether the failure to deliver the goods of fiscal decentralisation is fettered by misnomer implementation of the composite budgeting system. This paper therefore explores how composite budgeting and fiscal decentralisation has led to the strengthening of local democratic processes in Ghana. Using secondary data, the study reviews the legal frameworks for democracy and financial decentralisation. While Ghana has achieved some level of political and administrative decentralisation as well as decentralised planning, fiscal decentralisation has been the unyielding component of the process. For the realization of the inherent symbiotic output between fiscal devolution and democratic governance and the avoidance of vertical fiscal imbalances, social capital building and networking as well as the removal of barriers to local flexibility must be ensured. Further gains in this area must also be supported by greater levels of fiscal autonomy and fiscal accountability at the local government level.

Key words: Democracy, Ghana, Regulatory provisions, Fiscal Autonomy, Participatory Budgeting