Money for Development Consortium calls on DRC government to efficiently manage royalty taxes paid to Provincial administrations
The Makuta ya Maendeleo Consortium (Money for Development) invites the government of the Democratic Republic of Congo to initiate inclusive consultations with all stakeholders in order to define a coherent national policy for the collection, distribution and allocation of funds from 25 % and 15% of the mining royalty paid to Provinces and Decentralized Territorial Entities (ETD) for the financing of sustainable development projects in provinces and mining areas.
Since the second half of 2018, several mining provinces and ETDs have directly received the quotas of 25% and 15% of the royalty in accordance with article 242 of the Mining Code in order to finance projects of community interest. Although these revenues constitute a real opportunity for the sustainable development of populations directly impacted by mining, the rules and practices put in place in particular at the initiative of the provincial authorities for the collection, distribution and allocation of these funds, in particular those due to ETDs, are very diverse, incomplete and contrary to the spirit of the revised mining code.
The members of the Consortium have documented several problems related in particular to the modalities of collection and sharing of these funds between the ETD in superposition (city and municipality) and for the cases of mining projects overlapping two or more ETD, as well as problems of interference. of the province in the management and distribution of the 15% due to ETDs.
In addition, the absence of clear rules of transparency in the management and allocation of the quotas of 25% and 15% of the mining royalty means that the major part of these funds, in particular those of ETDs, is allocated to the realization of projects that do not necessarily match the development priorities of the populations. For ETDs, this problem is exacerbated by the absence of local development plans and participatory budget mechanisms. A recent study carried out by Cordaid has shown that a large part of the levy funds collected by the ETDs between 2018 and 2019 were mainly used for operating expenses of local administrations and for the retrocession in favor of certain provincial services.
The members of the Makuta consortium learned about the draft interministerial decree initiated by civil society and enriched by government experts with a view to setting the terms for the distribution and management of the quota of the mining royalty due to the ETD4. While welcoming this good initiative, the members of the consortium believe, however, that this draft decree could not solve all the problems mentioned above if it were to be adopted in its current version. This draft decree should constitute the basic document for a wider participatory debate in the inclusive process of developing the national policy relating to the management of the mining royalty funds allocated to the Provinces and to the ETDs.
The Makuta Consortium therefore calls on the Ministers of Mines and Finance to open inclusive consultations with representatives of communities, local, provincial and national authorities, civil society organizations, representatives of mining companies as well as financial technical partners to through the existing platforms for dialogue at the local, provincial and national level with a view to developing a coherent national policy for the management of mining royalty funds collected by the Provinces and ETDs.
Members of the Makuta Consortium remain ready to work with the Congolese government and all stakeholders in the process of developing, adopting and monitoring the implementation of such a policy supposed to ensure the responsible and transparent management of funds. of the mining royalty allocated to Provinces and ETDs for inclusive provincial and local development.
The main objective of the Makuta ya Maendeleo consortium is to ensure that revenues from the mining sector effectively contribute to the development of the Congolese populations. In particular, the consortium supports the adoption and implementation of a national policy for the management of mining royalty funds collected by the provinces and ETDs and the development of a national strategy for responsible and transparent management of the mining fund for the future generations. It is made up of 7 civil society organizations active in the governance issues of the DRC’s extractive sector: CdC / Ituri, Justice pour Tous, ADDH, IBDGH, OEARSE, Resource Matters and Carter Center
