Puntland Government’s to Initiatives to institutionalize Inter-governmental Fiscal Transfer

Puntland Ministry of Finance with Ministry of Interior officials and UNCDF field team haddiscussion meetingregarding the new disbursement system for the LDF 2016. The meeting led by the Minister of Finance HE Abdulahi Shiekh Ahmed and attended a senior Ministry staff, Ministry of Interior acting Director General, MOF technical team and UNCDF Field team.

This initiative came after long discussion between Puntland government and UNCDF/JPLG officials for the implementation of effective intergovernmental fiscal transfer system where Ministry of Finance has the main responsibility for the finance and budgets for the effects of the transfer.

Ahmed Noah; Local Government Finance Specialist came to the floor to explain the proposed grants transfer system which empowers Ministry of Finance to control all disbursement with no objection procedures , he mentioned that 2016 budget UNCDF will transfer 50% of all LDF budget fund as approved to Ministry of Finance special LDF account. He emphasised that this system will attract more donors whom want to find in place this system.

Ministry of Interior Director of planning noted that the progress made by the Ministry includes successful conduct of performance assessment, local revenue mobilization initiative. he noted that Minimum condition are aimed for ensuring LDF funds transferred to local authorities are used effectively and efficiently with minimum integrity and responsibility approach. he continued added that district need to have revenue autonomy so that to improve local service delivery as well as strengthened decentralization governance between local and central government

Minister of Finance H.E Abdulahi Sheikh Ahmed appreciated the progress of the JPLG program he mentioned that “JPLG is the only dream that achieved it’s result and Puntland government is pleased the process” said the Minister of Finance; he continued noting that the new system proposed will be the benchmark both for the Ministry of Finance and UNCDF/JPLG as well as its partners, he emphasised to call a meeting between Ministries agencies as well as JPLG partners to inform that that this sytem should be adapted by the coming year.

So far, implementation of the JPLG projects beyond the expected result, this supported by the quick fiscal transfer and supervision of the program.

The government has transferred fund for this program sine 2011 up to date more than USD $ 500,000,000.

The World Bank team assessed the LDF system and intergovernmental fiscal transfer, the team recommended how the system design and it’s practical transfer system for the local government, the team appreciated the LDF process as we all the intergovernmental fiscal transfer system with the support of UNCDF to the Ministry of Finance this has attracted more donors to engage the system.

In order to achieve this progress Ministry of Finance accomplished the approval of 1 % fixed national budget for LDF projects through cabinet consensus followed by presidential degree.

The Minister of Finance concluded that to continue its commitment with JPLG in enhancing local government’s capacity to deliver services to their community but advised donors to double their efforts to fund for the projects.

UNCDF had LOA with the Ministry of Finance to support the Ministry to play a significant responsibility in the implementation of the LDF in Puntland. The LOA intention is to provide a technical and logistical support to the Ministry to accomplish better Fiscal Decentralization system in Puntland. this resulted the overall performance of Ministry of Finance to ensure LDF implementation in to better results.

Mohamud Abdisalan Hassan Dualle
Ministry of finance



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