Govt to use new calculation method

The National Government has embarked on major financing re-arrangements that will be based on needs arising from actual cost of delivery of goods and services instead of the K20 per head of population or derivation grant.
National Economic Fiscal Commission chairman Dr Nao Badu said this at the National Development Forum organised by the Consultative Implementation and Monitoring Council.
Dr Badu said that cabinet had already endorsed the arrangements based on extensive study of the cost of delivery of goods and services to provinces and particularly remote and isolated districts.
He said the previous K20 per head derivation grant failed to take into account the actual cost involved in the delivery of goods and services and therefore did not fulfill the Constitutional goals of equality in access to goods and services provided by the State.
Under the new arrangements due for tabling in Parliament next month, each province will work out the total revenue – grants, internally raised revenue, goods and services tax and royalties.