Revenue at community and at Rural District Council level
Rural District Council level
What guides RDC financial management?
The overall policy for financial administration by RDCs is set out in the Rural District Councils Act (1988) and the Accounting Handbook for Rural District Councils. These state that:
Every council shall maintain proper books of accounts;
The books shall be kept using double entry accounting principles;
Every council will maintain a permanent record of moveable and immovable assets.
These policies also apply to the financial administration of CAMPFIRE revenue and assets. Importantly, the Accounting Handbook clearly prohibits loans between accounts. RDCs cannot use the CAMPFIRE Account to make loans to other RDC accounts.
What should the CAMPFIRE levy be used for?
The RDC levy is set at a maximum of 15% of gross CAMPFIRE revenue. The levy should be paid from the CAMPFIRE Account to the RDCs General Account at the same time revenue is disbursed to producer communities. Once in the General Account the levy can be used for general council activities.
What should the management fee be used for?
The management fee is set at a maximum of 26% of gross revenue. To balance income and costs to the RDCs all appropriate natural resource management activities should be transferred to sub-district levels along with the disbursement of the management fee to the community. The activities and costs incurred by the RDC will depend on the scale and complexity of CAMPFIRE within the district.
The RDCs management fees should not be used for infrastructural development. Even when such projects are proposed to donors, RDCs need to be very careful about their long-term technical viability and who will bear the maintenance costs.
The types of expenditure of RDCs can be broken into:
Programme management and co-ordination: The need for the RDC to manage and co-ordinate CAMPFIRE activities will depend on: The scale and diversification of CAMPFIRE activities; The level to which activities have been devolved; The development of new activities.
All RDCs will have to fund some CAMPFIRE management and co-ordination activities. The scale of CAMPFIRE activities will determine the costs. The costs of travel, meeting allowances, accommodation and stationery, at a district level, should all be met from the management fees.
Resource management: To be cost effective there are some activities which are best done at district level. These activities can legitimately be paid out of the RDC management fees. An example of such an activity might be small and armed “anti-poaching” or “problem animal management” teams.
For other activities, which involve many producer communities, for example district level quota setting, the RDC might request producer communities to make a financial contribution to the costs.
Training and technical support: Successful devolution of natural resource management activities is a process. It is important that communities receive appropriate training and technical support. CAMPFIRE aims to develop producer community capacity to manage natural resources. RDCs need to ensure that this process is being adequately supported through training and technical advice. It is, however, important that it is provided in efficient and cost effective ways. The exact mechanisms for doing this will vary from district to district.
Capital and other equipment: To support the smooth running of CAMPFIRE activities, RDCs may invest in capital and other equipment such as: a vehicle, office furniture, computers, and other equipment for use in the implementation of a natural resource management programme. The equipment should be used for CAMPFIRE in a cost effective way.
In Zimbabwe CAMPFIRE producer communities cannot function independently of the RDC. A maximum of 26% of the gross CAMPFIRE revenue should be used to support community-based, natural resource management activities at RDC or community level. RDCs need carefully to consider the cost of their CAMPFIRE activities in relation to the revenue they can retain
Revenue at Community Level
What are community-based natural resource management activities?
These are all the activities that are necessary to ensure that the producer community is managing its natural resources effectively. Examples of natural resource management activities that have been successfully carried out by producer communities are:
Law enforcement: Many communities employ “resource monitors” or “game-scouts” to monitor and apprehend those persons breaking the national, district or locally developed rules for using (or not using) resources.
Monitoring commercial activities: Communities usually use resource monitors to ensure that commercial activities are being undertaken in accordance with the contract.
Managing human-wildlife conflicts: In some communities, monitors are employed over the wet season to assess and report crop damage by wildlife. Other activities, such as electric fence maintenance, require daily maintenance all year round.
Fire management: Some communities have developed fire management programmes that involve early burning and, in some cases, making firebreaks.
Counting wildlife and quota setting: For communities to effectively manage wildlife they must be able to monitor changes in wildlife populations. Where these changes are significant, then they should be reflected in the off-take quotas.
Wildlife management calendars: A simple management calendar, which indicates when an activity must be undertaken, is a very useful tool for ensuring that essential activities are scheduled, included in the budget and carried out.
What expenditure can be made at producer community level?
Direct incentives: These are the household dividends paid by communities to individual households. Household incentives are very effective at raising the awareness of CAMPFIRE within an entire community. To pay household dividends means that:
Decisions on how a household qualifies for a dividend have been made and agreed upon by the community;
An inventory of all households in the community has been completed and lists of eligible and ineligible households compiled;
Secure arrangements have been made to deliver the money and distribute the money;
The money needed to meet other requirements has been deducted from the amount paid to households. ·
Development projects: These are projects that are either fully or partially funded by revenue earned from CAMPFIRE. Development projects are the most common investment made by communities from CAMPFIRE revenue. Generally these projects are used to enhance existing social infrastructure such as school buildings, clinic buildings, and diptanks. Successful projects are those that have:
Clearly defined management and responsibility roles,
Realistic and current budgets, and that
Benefit most of the households within the community.
As a general rule, communities should avoid undertaking large projects, which take several years to complete, or trying to do too many small projects, never finishing any of them.
Income generating projects: These are secondary activities whose objectives are to earn further revenue, as well as provide a service for the community. Income generating projects are found throughout CAMPFIRE communities. Experience has shown that many of these projects fail in their objectives. This is because communities and their representative structures (such as a ward wildlife committee) do not have the necessary skills, time or organisation to run business activities. RDCs and communities are strongly advised to avoid this category of investment. This does not mean that communities should not encourage business activities. If communities want to encourage business then they should consider:
Building and owing the infrastructure (i.e. a shop, a mill, a guest house) which is then leased to a business person. If this option is chosen the management committee must enter into a written and legally binding contract with the business person.
Using CAMPFIRE revenue as a loan for local emergent businesses. If this option is chosen the management committee must assess and minimise the risk to the community of the business person defaulting.
Some projects are managed by Trusts. The advantage of a community trust is that it is legally recognised and enables the community to own the project. The RDCs oversee their development and operation.
General management activities: Producer community management activities include all the activities that are necessary to ensure that the community is able to actively manage its natural resources. For example, meetings, training, quota setting, project planning and resource monitoring.
How should producer communities manage their revenues?
CAMPFIRE was the first development programme that transferred the responsibility for large sums of money to rural communities. To use their CAMPFIRE revenue effectively, communities need to develop financial management systems that are able:
To provide an orderly system for managing and recording all income and expenditure of community funds;
To provide an open and transparent financial management system so that people in the community have trust and faith in those handling CAMPFIRE revenue;
To provide accurate and up to date information for management, planning and budgeting purposes.
Communities need simple financial systems to achieve the above objectives. Above all else the systems need to encourage those running them to be consistent and regular in the way they do transactions. Note: Details on Financial Management can be found in the WMS Manual entitled Financial Management.
How should producer communities account for their expenditure?
Annual summaries of expenditure and proposed expenditure for the future year should be presented at the producer community’s Annual General Meeting. This will allow members of the community to monitor and comment on how their representatives are using CAMPFIRE revenue. In addition, this information should be given to the RDC for their records.
SummaryThe amount of revenue received annually will affect a producer community’s attitude to CAMPFIRE. It is important that money is used effectively in order to maximise the incentive for natural resource management. Producer communities must have in place systems for managing and recording all income and expenditure. All financial transactions must be carried out in a transparent manner so to keep the confidence and trust of the community members.