Accra: Parliament on Tuesday, March 17, 2026, approved the 2026 formula of the District Assemblies Common Fund (DACF), allocating GHS8,769,707,900 for disbursement. This allocation aligns with Article 252 of the 1992 Constitution, which mandates that not less than five per cent of total national revenue be allocated to the Fund.
According to Ghana News Agency, the allocation under the 2026 Appropriation Act represents five per cent of the projected total revenue for the fiscal year. This marks a 16.78 per cent increase compared to the GHS7.51 billion allocated in 2025. Majority Leader Mahama Ayariga presented the report in Parliament, seconded by Minority Leader Alexander Afenyo-Markin.
Some members of Parliament commended the Ministry of Finance for making full and prompt releases totaling GHS6.29 billion for all four quarters of 2025, ensuring Assemblies received their funds on time. However, the DACF Secretariat has drawn Parliament's attention to arrears from 2024 amounting to GHS7.33 billion, based on actual government revenue reported in the National Accounts. The Secretariat has requested Parliament's support to verify and recover these arrears to ensure that Assemblies are not deprived of resources.
Concerns were raised about revenue capping under the Petroleum Revenue Management Act, 2025 (Act 1138), which limits DACF allocations to a maximum of five per cent. This contradicts Article 252 of the Constitution, the Local Governance Act, 2016 (Act 936), and a Supreme Court ruling in 2019, prompting Parliament to review and remedy this situation.
There was a call for reforms in Ghana's fiscal transfer system, emphasizing the need for a predictable and automatic mechanism for funding the DACF. Such reforms are deemed essential to strengthen decentralization and ensure Assemblies have reliable resources to deliver development at the grassroots.
The 2026 formula for distribution is based on several indicators, including population, education, health, water coverage, and road infrastructure. Data was sourced from central institutions like the Ghana Statistical Service, Ministry of Education, Ghana Health Service, Community Water and Sanitation Agency, Ghana Water Company, and Departments of Urban and Feeder Roads.
A special 'service pressure factor' was introduced to compensate urban Assemblies for the over-utilization of their facilities by visitors. This ensures that Assemblies hosting large populations beyond their resident numbers receive additional support. The formula applies a location quotient method to rank districts based on their endowment of facilities. Less endowed Assemblies are allocated more resources to bridge developmental gaps, while better endowed Assemblies receive proportionally less, promoting equity in resource distribution.
Parliament's approval of the 2026 formula will enable the disbursement of GHS8.76 billion to the 261 Metropolitan, Municipal, and District Assemblies, reinforcing the government's commitment to decentralization and grassroots development.