Mozambique’s Ministry of Economy and Finance says that municipalities are partly responsible for budget cuts to the Municipal Investment Fund (FIA) and Municipal Compensation Fund (FCA).
Mozambique’s Deputy Minister of Economy and Finance, Carla Louveira, said last Friday that the channeling of the funds to the operation of municipalities also depends on their performance in collecting local revenues and sending them to the central government for redistribution.
“The channeling also depends on the budget cycle, therefore, the collection of funds from revenues by those (municipalities) that should channel the fund and consequently its channeling to the beneficiaries (redistribution to municipalities), therefore, it is a process,” explained the minister on a trip to Nampula.
Carla Louveira admitted that the central government has cut funds to the municipalities, but did not explain, in concrete terms, the reasons that led to the reduction of funds, limiting herself to saying that the cuts are foreseen in the State Budget. The minister also did not reveal whether measures are being taken to overcome the financial crisis of the municipalities.
