Framework for a Strategy of UP Revenue/Resource Mobilisation ...

� Regular transfers from central government: both the block grant direct to the UP and the
ADP grant that is managed at Upazila level;
� Special transfers under various government and donor-funded programmes, such as LGSP
and LGSP-LIC.
Own and shared revenues are deposited in the UP revenue accounts which are managed by the
Chairman and the Secretary (co-signatory). The payments are executed by either the Secretary or
the Chairman and recorded in the concerned accounting books. There are no requirements for
reporting the financial statements and bills related to own and shared revenues to Upazila
Accounting Officer. The ADP block grant at the Upazila level is transferred by the Chief Accounts
Officer (CAO) of the Ministry of Local Government, Rural Development and Cooperatives to the
bank account at the Upazila level that acts as the treasury. Once the projects are approved, the
Project Implementation Committee (PIC) and Project Supervision Committee (PSC) are formed.
The Accounts Officer directly or indirectly (through the Upazila Engineer) executes the payments
of bills. The Accounts Officer does not report back to Controller General of Accounts (CGA) Thus,
funds are never transferred to UP.
In the case of direct UP block grants introduced in 2004, the funds are transferred from the bank
that performs the treasury function at the Upazila level in four instalments in the course of the fiscal
year on the basis of UP requests countersigned by the Upazila Nirbahi Officer (UNO). At the end of
the year the UP has to provide the Accounts Officer with the receipts of payments together with a
financial statement. The last allotment is transferred only when the Accounts Officer has reconciled
the previous ones. The Accounts Officer does not report back to CGA. Direct funding to Union
Parishads is quite a new phenomenon in Bangladesh. The Sirajgang Local Governance
Development Fund Project (SLGDFP) (funded by UNDP and UNCDF) first piloted the concept in
Union Parishads that were covered under the project. Inspired by the successes of this new
approach, the government has been providing Block Grants directly to UPs since 2004. It is
envisaged that the LGSP will cover all the UPs in Bangladesh in phases. The performance based
direct fund transfer has been the most important salient feature of this project. In the same vein,
some other projects in different sectors with financial support from various development partners
have been launched.
b. System of Tax Assessment
According to the section 22 in chapter III of the Union Councils (Taxation) Rules, 1960 and the
Guidelines on Tax Assessment and Collection Strategy issued by the Local Government Division of
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