Parliament Approves GH₵8.77bn DACF Allocation for 2026 Amid Arrears Concerns

Parliament has approved the formula for distributing the District Assemblies Common Fund (DACF) for 2026, with a total allocation of GH₵8.77 billion. This marks a 16.78 per cent increase from the GH₵7.51 billion allocated in 2025, reflecting government efforts to boost funding for local development.

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The allocation represents five per cent of Ghana’s projected total revenue for 2026. Out of the total, GH₵166.95 million has been set aside for priority infrastructure and development initiatives aligned with national policy goals.

Despite the increase, concerns have been raised over outstanding arrears. According to a report submitted to Parliament by DACF Administrator Michael Harry Yamson, unpaid funds from 2024 amount to GH₵7.33 billion, based on actual government revenue figures. The Fund has therefore appealed to Parliament for support in verifying and recovering the arrears.

The report also questioned the legality of capping DACF allocations at five per cent under the Petroleum Revenue Management Act, 2025 (Act 1138). It argued that this cap contradicts provisions in the Constitution, the Local Governance Act, 2016, and a 2019 Supreme Court ruling. The Fund has called on Parliament to review and address the issue.

In addition, the report stressed the need for major fiscal reforms to strengthen decentralisation. It proposed the introduction of a more predictable and automatic funding mechanism to ensure timely and consistent transfers to district assemblies.

In terms of sectoral allocations, GH₵68.73 million has been dedicated to education-related programmes in selected districts, while GH₵98.22 million will support urgent intervention and strategic projects. A further GH₵603.02 million has been reserved for various initiatives, including GH₵87.70 million to assist distressed districts facing severe development challenges such as poverty, weak infrastructure, and limited access to basic services.

To enhance oversight, GH₵263 million has been allocated to Members of Parliament for monitoring and evaluating projects in their constituencies. MPs will be required to account for the funds with proper documentation.

During parliamentary debate, the Member of Parliament for Takoradi, Kwabena Okyere Darko-Mensah, welcomed the increase in the equality factor of the distribution formula from 20 to 40 per cent, noting that it would help reduce disparities among districts. He also highlighted the increase in the needs factor to 53 per cent but expressed concern that metropolitan assemblies were not adequately catered for, calling for additional support.

Meanwhile, Majority Chief Whip Rockson-Nelson Dafeamekpor underscored the urgency of clearing arrears, noting that over 4,700 stalled projects across the country depend on those funds. He urged the Finance Minister to prioritise payments to enable communities to benefit from completed infrastructure and services.