It was public money, collected from Ghanaian citizens and businesses under a simple promise: that a fifth of it would return to them as roads, water, healthcare and schools.

That promise, it turns out, was largely unkept.

The law here is not ambiguous. Paragraph 139 of the Ministry of Finance's Budget Preparation Guidelines and Section 30 of the Public Financial Management Act, 2016 (Act 921) leave no room for interpretation: Metropolitan, Municipal and District Assemblies (MMDAs) must commit at least 20 per cent of their Internally Generated Funds (IGF) to capital projects.

 This is not guidance or aspiration. It is a statutory floor, written into the framework that governs how local government spends the money it raises from its own people.

Yet the 2025 Auditor-General's Report on District Assemblies tells a different story. Ten distinct findings, spanning ten regions and collectively covering twenty-five MMDAs, show a pattern of assemblies collecting revenue and then quietly redirecting it away from the very projects the law requires it to fund.

Across ten flagged findings, District Assemblies collected a total of GH¢106,358,608.73 in Internally Generated Funds, of which GH¢21,271,721.30 (20%) was legally required to go toward capital projects; however, only GH¢2,431,064.85 was actually spent on capital projects across nine of the ten findings (Volta excluded, as the amount was undisclosed), leaving a shortfall of GH¢18,840,656.45 under-spent and an overall compliance rate of just 11.43%.

Strip away the accounting language, and the picture is stark. Of the more than GH¢106 million in IGF collected across these flagged assemblies, only GH¢2.4 million reached capital projects, against a legal requirement of over GH¢21 million.

That is a compliance rate of just 11.43 per cent, leaving a shortfall of nearly GH¢18.9 million that should have built or repaired public infrastructure but did not.

That gap explains what many communities already know from lived experience: the absence of capital projects. The roads that remain unpaved, the boreholes that were never sunk, the clinics without equipment, the markets without stalls, the classrooms still under trees or in disrepair, all of it traces back, in part, to revenue that was collected as promised but not spent as required.

This is not a story about a lack of resources. The money was raised. It sat in assembly accounts. The failure is one of compliance, oversight and, ultimately, accountability to the citizens who paid in good faith. Until the 20 per cent rule is enforced as firmly as it is written, the gap between revenue collected and development delivered will remain the defining feature of local government finance in Ghana.

Prof. Isaac Boadi is the Executive Director, Institute of Economic Research and Public Policy (IERPP)