A Comparative Analysis of Inter-governmental Fiscal Transfer Systems in East African Countries

Dr. Parestico Pastory

Inter-governmental fiscal relations has been one of critical areas of decentralization and local government reforms in developing countries since the last decade of the 20th century. Accordingly, there has been an increase in the size of the transfers in many countries including East African. While the proclaimed goals of inter-governmental fiscal transfer systems are similar across national jurisdictions i.e. aiming at realizing balanced development within a country, enhancing service delivery and promoting local revenue mobilization, their designs relatively vary. This paper draws from a comparative experience of Tanzania, Kenya and Uganda to examine how various inter-governmental fiscal transfer systems deliver to their supposedly objectives. It argues that despite their differences in designs, the extent to which fiscal transfer systems are likely to deliver is mediated by similar contextual variables. The paper utilizes documentary evidence and draws valuable lessons for East Africa and other developing countries.