Answer to Question #229054 in Management for Kuhle

Question

importance of the government policies and legislation in municipal finance management

Answer 1

Municipalities are an extension of the government and are subordinate to the country's government.

Government policies and regulation cubs the particular spending of municipalities. Government policy can alter the recruitment pattern of the municipality this controlling labour cost. Government also sets priorities for these municipalities thus twisting their commitment and financial capacity. For example government can develop a policy says there need be more car parks in town. This will affect priorities of municipalities.

Another policy of the government is curbing financial spending by local government. Need for availability of economic parity between projects done and reclamation of lost value. Once the government issue a directive, municipality abides and this can also mean their financial sourcing is limited.