Municipal Finance

Abstract

The economic empowerment of urban local bodies is essential for the effective delivery of urban development programmes. These institutions are to be provided adequate financial resources to carry out various development activities in the cities. They are to be empowered to raise tax and collect fees from their municipal areas and also get due share of the grant-in-aid from the central and provincial governments in time. The financial aspects of intergovernmental relations veritably influence the nature, scope, and depth of democratic decentralization. Urban finances are critical elements in sustainable urban development. Moreover, effective and efficient urban financial management system will go a long way to improve the financial health of the local bodies. It would enhance their economic competitiveness; make the delivery of urban services effective; expand and diversify their revenue; and generate fund through capital investments. Thus, municipal finance is one of the most important areas of the urban development system. Smart urban finance is the key requirement without which the quality of life of people in urban areas cannot be effectively improved.