Audit: St James Parish Council - The necessity of financial autonomy

Powell... "If we can get compliance up to 60 per cent, I think we would be able to make more money we would be able to pay our street light bill and our solid waste management bill comfortably." - Patrick Campbell/Staff Photographer.

Erica James-King, Staff Reporter

WESTERN BUREAU: THE MARKED increase in the salaries of civil servants and parish councillors, as well as the partial roll back in new property taxes, have intensified the pressure on the financial resources of the St. James Parish Council and sent it scrambling for creative strategies to stimulate its revenue earning potential.

To date, the "narrow benefits" of Local Government Reform have mostly consisted of the decision to pay councillors and provide the source of funds to pay them.

The new salary package for councillors and the 125 members of staff at the St. James Parish Council has eaten up a substantial amount of its budget. According to Christopher Powell, Secretary/Manager, the segment of the budget assigned for salaries climbed from a projected 15 per cent to 20 per cent, after the payment of the new wage increases.

Under the new contract, salaries were adjusted to 80 per cent of market rate, effective October last year. In addition, the Council had to dig in its coffers to pay out over $17 million in increases to the roughly 200 government pensioners and retired persons.

PROPERTY TAXES

Research shows that municipalities around the world depend on property taxes as their major source of funding, and especially in the developed world, 80 per cent of the financing of the budget come from land taxes. In the case of the St. James Parish Council, revenue from property taxes only accounts for 30 per cent of the budget, but the Council could earn up to 65 per cent of its income from property taxes, if certain hurdles are successfully scaled.

Citing an example, the Council pointed out that in the year 2001/2002, the revenue collected from property taxes was about $58 million, but with a significantly higher compliance rate, that could move to $80 million. "The problem is that the compliance rate for property tax payment in the country in general and in St. James, in particular, is between 40 per cent and 45 per cent," according to the Secretary/ Manager. "If we can get compliance up to 60 per cent, I think we would be able to make more money. In fact, we would be able to pay our street light bill and our solid waste management bill comfortably."

NEW APPROACH TO USER FEES

Eight years after the Local Government Reform Programme was launched, the St. James Parish Council, like other Councils, is suffering from a paucity of data on user fees. Reason being historically, the Councils depended so heavily on Central Government, that they did not think it necessary to keep accurate records on persons using their services.

If the St. James Parish Council is to maximise its earnings and put realistic plans in place, it must, as a matter of urgency, correct the chronic data problem. User fees are now approximately 20 per cent of the income of the St. James Parish Council and measures are being put in place to formulate a registry of barbers, hairdressers, butchers and other users targeted by the Parish Council.

The Ministry of Local Government is funding that survey and data registration programme which got off the ground during mid-February in St. James, and is slated to last for eight to 12 weeks. Parish Council records indicate that during the first two weeks of the programme, $60,000 was expended on the programme.

FINANCIAL FOOTING

Meanwhile, the Jamaica Association of Local Govern-ment Officers (JALGO), which represents civil servants at the Parish Councils and the Local Government Ministry in general, is urging the authorities, to speed up reforms relating to financial autonomy of the St. James Parish Council and other Parish Councils, if they are serious about placing local authorities on a sound financial footing.

"We have found situations where, a number of the user rates being charged are practically ridiculous and bear absolutely no relationship to actual cost of providing the service," laments Helene Davis-Whyte, General Secretary of JALGO. "We would really like to see a situation where the Councils get more autonomy, so they are able to set rates based on the actual cost of providing service."

She is, however, cautioning that, where rates are concerned, the Councils could be put under a regulatory body similar to what applies to the utility companies, which are monitored by the Office of Utilities Regulation.