By Godwill Arthur-Mensah, GNA
Accra, March 17, GNA – Parliament on Tuesday, March 17, 2026, approved the 2026 formula of the District Assemblies Common Fund (DACF), allocating GH¢8,769,707,900 for disbursement.
This is in line with Article 252 of the 1992 Constitution which mandates that not less than five per cent of total national revenue be allocated to the Fund.
Under the 2026 Appropriation Act, the allocation represents five per cent of projected total revenue for the fiscal year.
The allocation for 2026 marks a 16.78 per cent increase compared to the GH¢7.51 billion allocated in 2025.
Majority Leader Mahama Ayariga presented the report on the floor of Parliament during Tuesday’s proceedings, which was seconded by Minority Leader Alexander Afenyo-Markin.
Some members of Parliament (MPs) commended the Ministry of Finance for making full and prompt releases totalling GH¢6.29 billion for all four quarters of 2025, which ensured Assemblies received their funds on time.
However, the DACF Secretariat has drawn Parliament’s attention to arrears from 2024 amounting to GH¢7.33 billion, based on actual government revenue reported in the National Accounts.
The Secretariat has requested Parliament’s support to verify and recover these arrears to ensure that Assemblies are not deprived of resources.
Some legislators raised concerns about revenue capping under the Petroleum Revenue Management Act, 2025 (Act 1138), which limits DACF allocations to a maximum of five per cent.
This contradicts Article 252 of the Constitution, the Local Governance Act, 2016 (Act 936), and a Supreme Court ruling in 2019 and, thus, Parliament was urged to take steps to review and remedy this situation.
There was a call for reforms in Ghana’s fiscal transfer system, stressing the need for a predictable and automatic mechanism for funding the DACF.
It said such reforms were essential to strengthen decentralisation and ensure Assemblies have reliable resources to deliver development at the grassroots.
The 2026 formula for distribution is based on several indicators, including population, education, health, water coverage, and road infrastructure.
Data was sourced from central institutions such as the Ghana Statistical Service, Ministry of Education, Ghana Health Service, Community Water and Sanitation Agency, Ghana Water Company, and Departments of Urban and Feeder Roads.
A special “service pressure factor” was also introduced to compensate urban Assemblies for the over-utilisation of their facilities by visitors.
This ensures that Assemblies hosting large populations beyond their resident numbers receive additional support.
The formula applies a location quotient method to rank districts based on their endowment of facilities.
Less endowed Assemblies are allocated more resources to bridge developmental gaps, while better endowed Assemblies receive proportionally less.
This approach is intended to promote equity in resource distribution.
Parliament’s approval of the 2026 formula will enable the disbursement of GH¢8.76 billion to the 261 Metropolitan, Municipal and District Assemblies, reinforcing the government’s commitment to decentralisation and grassroots development.
GNA
Edited by Linda Asante Agyei