Questions over how Ghana’s District Assemblies Common Fund (DACF) is being utilised are returning to the centre of the country’s governance and fiscal decentralisation debate, after fresh academic research suggested that rising transfers to local authorities may not necessarily be translating into stronger service delivery or improved local revenue mobilisation.
The concerns were raised by Michael Hanson, a PhD student at the University of Ghana, during the maiden University of Ghana–World Bank PhD Students Research Colloquium, where researchers presented findings aimed at influencing national policy discussions.
Presenting his research on “Strengthening the State’s Effectiveness Through Fiscal Decentralisation: Insights from Ghana’s District Assembly Common Fund,” Hanson argued that while Ghana continues to increase allocations to district assemblies, many local authorities appear to be growing increasingly dependent on central government transfers rather than improving their own internally generated funds (IGF).
For many ordinary citizens, he said, the frustration is visible in everyday life.
“Suppose you wake up in the morning and you want to go to work, but your roads are untarred. You want to go to the hospital and access good healthcare delivery, but you still face challenges,” Hanson told The High Street Journal after his presentation.
“Meanwhile, people are paying property rates, taxes, fines and other levies to their local authorities. On top of that, central government is also transferring money through the District Assemblies Common Fund. So naturally, citizens expect to see improvements in the basic social infrastructure around them.”
His research suggests that the disconnect between rising fiscal transfers and visible development outcomes may be weakening public confidence in local governance systems and discouraging compliance with local tax obligations.
Transfers Rising, But Questions Remain
According to Hanson, Ghana’s fiscal transfers to local authorities have increased significantly over the years, yet many assemblies continue to struggle with service delivery and revenue mobilisation.
He noted that although large allocations are announced annually, the actual amounts disbursed to assemblies are often much lower. More critically, he argued that some assemblies may have become overly reliant on DACF inflows.
“The findings show that assemblies receiving more DACF transfers tend to become relaxed in raising their own revenues,” he explained.
“They assume the funds will keep coming, so the urgency to improve local revenue mobilisation weakens.”
That dependency, he argued, creates a cycle where poor service delivery further reduces citizens’ willingness to pay taxes and levies.
“If my streetlights are not working and basic services are not improving, you cannot expect me to keep paying property rates enthusiastically,” Hanson stated.
The research further raised concerns about expenditure patterns within some assemblies.
“We are also finding that expenditure is not moving in tandem with the funds received,” he said. “In some cases, assemblies are spending less than what they receive. So the obvious question becomes: where is the rest going?”
Rethinking the DACF Model
Hanson believes the current DACF model may require structural reforms to strengthen accountability and performance.
One proposal emerging from his ongoing doctoral work is to tie future DACF transfers to measurable development outcomes rather than treating allocations as blanket disbursements.
“We should not simply distribute DACF equally without considering performance,” he argued.
“The transfers should be conditioned on how effectively assemblies deliver the core responsibilities the DACF was created to support, healthcare, education, roads and infrastructure.”
Under such a model, assemblies demonstrating stronger delivery outcomes could potentially qualify for greater fiscal support, creating incentives for improved governance and service provision.
“People will be forced to deliver more services, and that will convince citizens that their resources are being used properly,” he added.
World Bank Pushes Research-to-Policy Agenda
The broader significance of the colloquium extended beyond Hanson’s presentation itself.
Speaking at the event, World Bank Division Director Robert Taliercio O’Brien stressed the growing importance of linking academic research directly to policymaking and institutional reform.
“The World Bank is placing renewed emphasis on knowledge as a core part of how we support development,” he said.
According to him, development challenges increasingly require evidence-based policymaking grounded in practical realities rather than assumptions.
“Good research sharpens our understanding of what works, for whom, under what conditions, and at what cost,” he noted.
He said Ghana’s policy priorities, including jobs, skills development, fiscal resilience, service delivery and private-sector growth, make rigorous research particularly important at this stage of the country’s development trajectory.
O’Brien also challenged researchers to move beyond theoretical arguments and focus on policy relevance.
“As you present your research, ask not only whether the argument is strong, but whether the insight can travel beyond the dissertation into institutions, programs and public action,” he said.
Building a Knowledge Partnership
The colloquium forms part of a broader collaboration between the World Bank and the University of Ghana aimed at strengthening links between academia, government and development institutions.
O’Brien described the University of Ghana as an increasingly important “knowledge partner” for the World Bank, particularly through collaborations involving the Institute of Statistical, Social and Economic Research (ISSER) and the African Center for Economic Transformation (ACET).
“The real opportunity before us is not simply to hold a successful event today,” he said, “but to build a sustained platform for collaboration between research and policy, between universities and development institutions, and between ideas and implementation.”
For Ghana, where fiscal decentralisation remains central to local governance and development planning, Hanson’s findings are likely to deepen ongoing conversations around transparency, accountability and whether public resources at the district level are generating the developmental outcomes citizens expect.
